BU357 Chapter Notes - Chapter 4: Sole Proprietorship, Deferral, Capital Asset
Document Summary
Chapter 4: income from business: general concepts and rules. Major differences between income for tax purposes and income for accounting purposes. Number and frequency of transactions in a given period of time. Length of period of ownership of asset. Supplemental work on or in connection with property. Subsidies are considered capital if: the were meant to reimburse or assist taxpayer for capital outlay or encourage activity in the public interest (unemployment: debt obligations: the principal amount borrowed is not considered income. Business income vs property income: income from property: if taxpayer showed little or no activity, it is considered passive (dividends, interest on bank savings, income from business: taxed differently than income from property. Sole proprietorship: there is a provision for an alternative fiscal period for a business carried on by an individual; a change in the end of a fiscal period can only be made with ministerial concurrence.
