It is early April 2020 and you, CPA, work in a mid-sized accounting firm in Regina, Saskatchewan. While you normally work on audits, you have requested to participate in the personal tax pool this year. The experience gained will be valuable for your career. You meet with the partner, Aram Anzari, who has instructions for a special personal tax return he would like you to prepare.
Task #1 Aram asks you to prepare the 2019 tax returns for his good friends Kathy and Kevin Dhaliwal. Aram has shared with you the Dhaliwals’ personal tax information, as provided by Kathy (see Appendix). In Excel, you will need to calculate the federal income taxes payable, showing all components and calculations for the Dhaliwals. You have been asked to ignore any CPP/QPP on self-employment income. (Your memo should be no longer than one page, excluding any Excel files.)
Task #2 You have also been asked to write a short memo to Kevin and Kathy explaining the results of the tax calculation and when their returns are due. Aram also asked you to explain any evidence that the Canada Revenue Agency (CRA) may request for the Dhaliwals’ claim for child care expenses and donations. He is aware of the fact that the CRA has been auditing these items more frequently and he wants to make sure the Dhaliwals are ready to respond. (Your memo should be no longer than one page, excluding any Excel files.)