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Question 4

Mr. North is 55 years old and lives in Kamloops, British Columbia. He works in the IT department

of a large accounting firm.

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1.    Mr. North was divorced and had custody of his 10-year-old son, Jack. In 2018, Jack had net income for tax purposes of $4,200. The $4,200 was comprised 100% of interest income, which was earned on bonds acquired from an inheritance. Jack's medical condition qualified Alex for the disability tax credit.

 

2.    In 2018, Mr. Ken North installed access ramps in his home, to assist Jack in getting around. The access ramps cost $18,000.

 

3.    Mr. North, during 2018, volunteered 340 hours as a search and rescue volunteer. He received $480 in compensation for this work.


4.    Mr. North's 77-year-old father, Michael, lived with Mr. North. Michael provided care for Jack on a full-time basis. In 2018, Michael had $11,000 net income for tax purposes.

 

How does the 4 steps incorporate into 2018's federal tax payable ? I STARTED IT BUT NOT SURE HOW THESE FOUR STEPS ARE INCLUDED, PLEASE PROVIDE CALCULATIONS.

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Federal Tax Payable Tax On First $205, 842 $47,670 Tax On Next $22,118 at 33% Tax Before Credits Tax Credits: Basic Personal Amount ($11,809)
Canada Caregiver For Child - Alex Disability Supplement Access Ramps Expense ($18,000)
Medical Expenses ($12,598)
Federal lnome Tax Total Credit Base Rate 15% Charitable Donations $7,299
$54,959 ($2,604) Federal Tax Payable

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