Question

1,Which of the following persons is NOT liable for Canadian income tax under Part I of the Income Tax Act?

		Pheap Chom, an individual who has resided in Canada for the past 15 years.
		Chom Incorporated, a Canadian resident corporation.
		Phon Im, a resident of the United States who earns employment income in Canada.
		Bunly Im, a resident of the United States who earns interest income in Canada.

2

Which of the following is an argument in favour of a regressive tax system over a progressive tax system?

		Provides vertical equity because higher income earners pay higher taxes.
		Less complex than a progressive tax system.
		Provides more stability by shifting taxpayers to a lower tax bracket during times of economic downturn.
		Provides horizontal equity because taxpayers pay the same amount of tax on the same level of income.

3

Which of the following types of income earned by a non-resident individual is NOT subject to Canadian income tax under Part I of the Income Tax Act?

		Employment income earned in Canada
		Business income earned in Canada
		Rental income earned in Canada
		Income from the disposition of Canadian real estate 4 Of the following statements about tax credits, which one is correct? They are deducted from total income and are effectively not subject to tax. They reduce tax by the same amount regardless of a taxpayer’s marginal tax rate. They are deducted from Net Income For Tax Purposes and are effectively not subject to tax. Their impact is greater for taxpayers with a higher marginal tax rate. 5 If a Canadian public corporation is experiencing a year-to-year decrease in taxes payable, the most advantageous calculation of instalments that would be allowed is: monthly, based on the estimated tax for the current year. quarterly, based on the estimated tax for the current year. monthly, based on the estimated tax for the immediately preceding year. quarterly, based on the estimated tax for the immediately preceding year. monthly, based on the estimated tax for the second preceding year and the immediately preceding year. quarterly, based on the estimated tax for the second preceding year and the immediately preceding year.

Answer 1

1,Which of the following persons is NOT liable for Canadian income tax under Part I of the Income Tax Act?

The Answer is : Bunly Im, a resident of the United States who earns interest income in Canada

2. Which of the following is an argument in favour of a regressive tax system over a progressive tax system?

The Answer is : Less complex than a progressive tax system.

3. Which of the following types of income earned by a non-resident individual is NOT subject to Canadian income tax under Part I of the Income Tax Act?

The Answer is : Income from the disposition of Canadian real estate

4. Of the following statements about tax credits, which one is correct?

The Answer is : They reduce tax by the same amount regardless of a taxpayer’s marginal tax rate.

5. If a Canadian public corporation is experiencing a year-to-year decrease in taxes payable, the most advantageous calculation of instalments that would be allowed is -

The Answer is : monthly, based on the estimated tax for the current year.

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