Question True and false identify the right answers 1. Tax expenditures are les c

Question

Question True and false

identify the right answers

1. Tax expenditures are les costly to administer than direct funding program? True or false

2. Part 1 of the Income Tax Act is the largest and most important part? True or false

3. The ciatation ITA 61 (4) (b) (ii) would be read 61, Subparagrah 4, Section b, Subsection ii? true or false

4. An income tax is payable for each taxation year on the Taxable Income of every person resident in Canada at any time in the year? true or false

5, The tax rules for dternin business income are identical to those used for determining property income.? True or false

6. When property acquired for personal use is sold for more than it cost, there will be a taxable capital gain? True or false

7. If an asset has been held for a considarable period of time, any gain its disposition will be treated as business income? True or false

8. Difference between business income for tax purposes and businesss income as detrined under GAAp can be either perment or temporary? True false

9. Landscaping costs can be detucted in the detemination of net business income, even if they involve items that would normally be considered capital assests? true or false

10. one of the reasons for the favourable tax treeatment of capital gains is that the amounts recieved often have to be reinvested in the business o order to maintain its productivity capacity? True or false

Explanation / Answer

1. True: administratopm cost of tax expenditure is less than direct spending

2. True: Part 1 of the Income tax is the larget and also important as it contains diffrent sources of Income and their tax treatment which is more imprtant for both government and taxpayers to know their tax liability

3. False: It is read as : The citation IT A 61 (4) (b) (ii) would be read as 61, subsection 4, paragraph b, subparagraph ii

4. True : An income tax payable for each taation year on the taxable income of every person resident in Canada at any time in the year

5. False : Tax rules for determining Business income are not identical to property Income. Both are different in calculation and rates of tax.

6. True. Capital gains on personal property is taxable and losses on the disposition of personal property are not tax deductable

7. False : Business income is not on the basis of any asset held for short period or long-period, this holding period is applicable for calculation of capital gains whether thery are of short period or long period

8. True; Differences between business income for tax purposes and business income, as determined under GAAP can be either permanent or temporary. Permanent differences are treatment of cost of employee meal and entertainment, interest on muncipal bonds etc. temporary difference are due to timing difference book record and actual payment or receipt

9. True. Landscaping costs can be deucted from business income when we incur such costs

10. True. Favaourable treatment on capital gain is that the amounts received offen have to be invested in the business to maintain its productivity capacity

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