BUSI 428 - Canadian Taxation
________ involves structuring transactions to reduce the tax liability of the taxpayer consistent with the
intent of the income tax legislation. - ✔✔ correct answer Tax Planning
Carl works for Sam. Sam pays Carl entirely in cash and does not issue any tax reporting documents to
Carl, although both know they are supposed to submit reporting documentation. Carl does not file an
income tax return. Carl and Sam are engaging in ________. - ✔✔ correct answer Tax Evasion
A transaction (or series of transactions) that results in a tax benefit and has no other bona fide purpose
is ________. - ✔✔ correct answer An avoidance transaction
The largest single source of revenue for the Canadian government is ________. - ✔✔ correct answer
Personal income tax
Which of the following taxes combines both federal and provincial sales taxes into a tax levy? - ✔✔
correct answer Harmonized Sales tax (HST)
Which of the following elements, within the organization and structure of the Income Tax Act, refers to a
subparagraph of the Income Tax Act? - ✔✔ correct answer lowercase Roman numeral in parentheses
Canadian individual income tax is an example of a(n) ________ tax system. - ✔✔ correct answer
progressive
The primary purpose for the federal government to collect tax revenues is to ________. - ✔✔ correct
answer provide public goods and services
Which of the following taxes is inherently a regressive tax system? - ✔✔ correct answer Sales tax
Consider the following scenario.
Linda
has taxable income of
$400,000
and income taxes payable of
, BUSI 428 - Canadian Taxation
$60,000.
Nancy
has taxable income of
$55,000
and taxes payable of
$8,250.
This scenario represents which type of tax system? - ✔✔ correct answer flat
Income Tax Regulations ________. - ✔✔ correct answer are established to provide specific details and
procedural requirements necessary to enforce the Income Tax Act
Division ________ of the Income Tax Act deals with computing the net income for a taxpayer resident in
Canada. - ✔✔ correct answer B
Administrative or informative guides that can assist with filing an individual income tax return can be
found ________. - ✔✔ correct answer on CRA websites
CRA publications can best be described as ________. - ✔✔ correct answer helpful interpretations of how
the Income Tax Act applies to real-life scenarios; however, these interpretations do not have the force of
law
If a Canadian taxpayer is unsure of the income tax consequences of a proposed transaction, he or she
may choose to pay a fee for the CRA to issue a(n) ________. - ✔✔ correct answer Advance Income Tax
Ruling
Section 3 of the Income Tax Act describes: - ✔✔ correct answer the liability for income tax for non-
residents earning Canadian income
A Taxable Capital Gain is defined as: - ✔✔ correct answer 50% of a Capital Gain realized in a taxation
year
________ involves structuring transactions to reduce the tax liability of the taxpayer consistent with the
intent of the income tax legislation. - ✔✔ correct answer Tax Planning
Carl works for Sam. Sam pays Carl entirely in cash and does not issue any tax reporting documents to
Carl, although both know they are supposed to submit reporting documentation. Carl does not file an
income tax return. Carl and Sam are engaging in ________. - ✔✔ correct answer Tax Evasion
A transaction (or series of transactions) that results in a tax benefit and has no other bona fide purpose
is ________. - ✔✔ correct answer An avoidance transaction
The largest single source of revenue for the Canadian government is ________. - ✔✔ correct answer
Personal income tax
Which of the following taxes combines both federal and provincial sales taxes into a tax levy? - ✔✔
correct answer Harmonized Sales tax (HST)
Which of the following elements, within the organization and structure of the Income Tax Act, refers to a
subparagraph of the Income Tax Act? - ✔✔ correct answer lowercase Roman numeral in parentheses
Canadian individual income tax is an example of a(n) ________ tax system. - ✔✔ correct answer
progressive
The primary purpose for the federal government to collect tax revenues is to ________. - ✔✔ correct
answer provide public goods and services
Which of the following taxes is inherently a regressive tax system? - ✔✔ correct answer Sales tax
Consider the following scenario.
Linda
has taxable income of
$400,000
and income taxes payable of
, BUSI 428 - Canadian Taxation
$60,000.
Nancy
has taxable income of
$55,000
and taxes payable of
$8,250.
This scenario represents which type of tax system? - ✔✔ correct answer flat
Income Tax Regulations ________. - ✔✔ correct answer are established to provide specific details and
procedural requirements necessary to enforce the Income Tax Act
Division ________ of the Income Tax Act deals with computing the net income for a taxpayer resident in
Canada. - ✔✔ correct answer B
Administrative or informative guides that can assist with filing an individual income tax return can be
found ________. - ✔✔ correct answer on CRA websites
CRA publications can best be described as ________. - ✔✔ correct answer helpful interpretations of how
the Income Tax Act applies to real-life scenarios; however, these interpretations do not have the force of
law
If a Canadian taxpayer is unsure of the income tax consequences of a proposed transaction, he or she
may choose to pay a fee for the CRA to issue a(n) ________. - ✔✔ correct answer Advance Income Tax
Ruling
Section 3 of the Income Tax Act describes: - ✔✔ correct answer the liability for income tax for non-
residents earning Canadian income
A Taxable Capital Gain is defined as: - ✔✔ correct answer 50% of a Capital Gain realized in a taxation
year
