DETERMINATION OF INCOME

DETERMINATION OF INCOME - categories are aggregated in...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
DETERMINATION OF INCOME * Each of the primary entities is required to pay a rate of tax on its taxable income in each taxation year * Income for tax purposes included the following: o Each entity subject to tax determines its taxable income on the basis of a taxation year. o Income for each entity includes and is restricted to the world income generated from ±ve general categories. Each category of income is determined in accordance with its own brief set of fundamental principles. o The net incomes (revenues minus expenses) for each of the ±ve
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: categories are aggregated in accordance with a strict formula, the sum of which is referred to as net income for tax purposes o The sum of the ve categories of income is then reduced by a limited number of specic items. Such items differ for the two primary entities. The total is referred to as taxable income and is the base to which the rate of tax is applied. * Taxable income for a taxation year of an entity subject to tax in Canada can be expressed as: TI = Net income - Special reductions...
View Full Document

Ask a homework question - tutors are online