AFM 361 Chapter Notes -Debt Relief, Property Income, Accounting

• School: University of Waterloo
• Department: Accounting & Financial Management
• Course: AFM 361
• Professor: Kevin Markle

Document Summary

Income from a business for a taxation year is the profit therefore for the year. While the word profit is not defined in the act, subdivision b contains numerous specific rules regarding amounts to be included in income and amounts which may or may not be deducted for income tax purposes. Income receipts are fully taxed and capital receipts are only partially taxed as capital gains. Historically, the inclusion rate for capital gains has ranged from 0% to 75%, with the current inclusion rate being 50% Objective of the analysis: to help make the distinction between an income and a capital transaction, the courts attempt to assess the intention of the taxpayer in the transaction. 4,025 damages as a receipt of income or capital. Non-performance of business contracts: damages received for non-performance of business contracts are usually intended to place the recipient in the same position as he or she would have been had the contract been performed.