CH 8 - Understanding Tax Returns

Question 1

T3 Slip - Statement of Trust Income Allocations and Designations

Answer 1

amount of income (interest, dividends, and capital gains) distributed to investors holding mutual fund trust

Question 2

T4 Slip - Statement of Remuneration Paid

Answer 2

total compensation paid to an employee

Question 3

T4A Slip - Statement of Pension, Retirement, Annuity, and Other Income

Answer 3

amounts paid from pension plans and other

sources (annuities, scholarships, RESP)

Question 4

T5 Slip - Statement of Investment Income

Answer 4

issued by financial institutions.

Reports interest, dividends, and capital gains paid to individuals

Question 5

T5008 Slip - Statement of Securities Transactions

Answer 5

amounts received from the disposition of securities for taxable accounts

Question 6

steps to calculate taxes

Answer 6

1. Calculate Total Income
2. Calculate Net Income
3. Calculate taxable income
4. Calculate taxes owing
5. Calculate refund or owing

Question 7

Items not considered taxable benefits

Answer 7

• private medical insurance plan
• Allowance for employee provided car
• Business meal and entertainment
• Employer paid courses
• Moving costs
• Club memberships (integral to business)
• Short and long term disability only if employee pays premiums

Question 8

standby charge

Answer 8

applies whenever an automobile is made available to the employee “by virtue of employment.”