TI
FPr
obl
emOne-1
I
n
tr
odu
ct
io
n-Es
sayQu
est
i
ons
CHAPTERONETESTI
TEM FI
LE
PROBLEMS
TI
FPROBLEM ONE-1
I
NTRODUCTI
ON-ESSAYQUESTI
ONS
1
.Themaj
orsou
rceoffe
der
alrev
enuesisthe
per
son
ali
ncometax.I
ndi
cat
ethreeot
hertyp
esof
ta
xest
hatc
ontri
but
etofed
eralr
evenu
e s
.
2
.Whati
sth
emean
ingof"
per
son
"wh
ent
het
ermi
sus
edi
n
th
eInc
omeTa
xAct?
3
.Br
ief
lydescr
ibet
heprocedu
resusedi
ncalc
ula
tin
g
pr
ovi
n c
ial
incometax
e sf
orind
ivi
dual
sin
pr
ovi
n c
esothert
hanQu e
bec.
4
.TheCanadi
anincometaxsys
temisoft
enuse
dto
ac
h i
eveva
riouseconomi
cobjec
ti
ves.
Givet
hree
ex
a mpl
esthatil
l
ustr
atet
hispoi
nt.
5
.Provi
deanexa
mp l
eofhowtaxa
tionp
oli
cyc
anb
eus
edt
o
in
flu
encere
sourc
eall
ocat
ion
.
6
.Theg over
nmentp a
ysa" c
hil
dta xbe n
efi
t"tot
he
pare
ntsofc h
il
drenwhoareunder18y ear
sofage.
Thep aymentsarer e
ducedbyap er
centa
geof
in
come i ne xc
ess ofa s pec
ifi
edl evel
.Wh a
t
obj
ectiv
esareachie
vedbythi
sben e
fitsys
tem?
,7
.In
d i
cat
ethre
ed i
sad
van
tag
esofat
axs
yst
emt
hatu
ses
progr
essi
verat
es.
8
.Aregre
ssiv
etaxisonetha
ttaxe
shi
ghincome
in
divi
dual
satlowere
ffec
ti
verat
es.
Expl
ainwhya
sal
estaxle
vie
da taf
latr
ateof8per
cen
tc a
nbe
regr
essi
ve.
9
.Dis
ti
ngui
shbet
weenh
ori
zon
tal
equi
tyandver
ti
cal
equi
tya
sthe
seter
msareus
edind
e-sc
ri
b i
ngtax
syst
ems.
1
0. Wh atar
es omeoft
hefact
orsth
atha
vel
edt
o
thee
ntr
enchedu s
eofta
xe x
pendi
tur
esa
sop-
pose
dtop r
ogra
ms p
endi
ng?
1
1. Wh i
l
etheSecti
onsoftheIn
comeTaxActar
e
numb
ered1throu
gh2 6
0,the
reareact
uall
ymore
th
an260Sec
tions.E
xplai
nwh yt
hisi
sthecas
e.
1
2. Wh atpu
rpos
esa
res
erv
edb
yCa
nad
a'si
nte
rna
tion
al
ta
xtr
eat
ie
s?
1
3. L i
stfourn
on-
l
egi
sl
ati
ves
our
cesofi
ncomet
ax
in
for
mation.
1
4. Wh ati
sth
eme a
nin
gof"t
axa
tiony
ear
"ast
hep
hra
se
isu
sedi
nth
eInco
meTaxAct
?
1
5. Un de
rwh a
tci
rc
ums t
anc
eswil
lape
rsonwh
o
isn
otresi
denti
nCanadaber
equ
ire
dtopay
Canad
ianinc
ometaxe
s?
1
6. Wh ati
stheimp
ort
anc
eofr
esi
den
cei
nCa
nad
ian
in
comet
axa
tion
?
,1
7. Wh enanindi
vidualle
avesCa n
a d
a,theCRA
maytakethep osi
ti
ont hatheh asreta
inedhis
re
sid
encesta
tus
.Wh atarethepri
maryfac
tor
sthat
th
eCRAwi l
lcon
s i
derindeter
mini
ngwh et
hersuc
h
anin
div
idua
lhas,i
nf a
c t
,ceasedtobeaCa na
dia
n
re
sid
ent?
1
8. L i
stth
reefac
tor
stha
twou l
db econ
sid
eredi
n
thed
eter
minati
onofwhet
herornotanin
di-
vi
dual
isar
eside
ntofCanada
.
b
lac
kdo
ll
ar
4st
uvi
a
1
, TI
FPr
obl
emOn
e-1
I
ntr
odu
cti
on-
Ess
ayQu
est
io
ns
1
9. I fa n i ndi
vid
uall eaves Ca na
daf or a
te
mp orar
ya bsence,thi
sr ai
sest hequ est
ionof
whetherhewa saCa nadi
anr esi
d e
ntd ur
ingt he
per
iodofa bsence,par
ti
cula
rlyifsomer es
identi
al
ti
esh aveb eenr etai
ned.Wh ata ret he major
fa
ctorsthatar
ec onsi
dere
dind ete
rminingwh e
ther
anindiv
idualconti
nuestobeaCa nadi
anres i
dent
dur
ingatemp orar
ya bs
ence?
2
0. On eofy ourfr
ien
dsi sl
eavi
ngCa nadaand
wouldli
ket oknow whenh ewillnolongerbe
consi
der
edaCa nadi
anresi
den
t.Bri
efl
yexpl
ai
nthe
rul
esrel
ate
dt oter
minat
inganind
i-v
idua
l'
sstat
us
asaCa n
adianre
side
nt.
2
1. F orthecurr
entyear
,JaneDoeisdeemedt oa
Canadi
anr esidentb e
causes hes oj
ou r
nedi n
Canadafor2 10d ay
s.Alsoforthec u
rrentye a
r,
JackFawn,along-t
imeresi
dentofMani-
toba,wa s
consi
deredap artyearres
iden
tforthef i
rst2 1
0
days,aft
erwh i
chh ep e
rmanent
lydepart
edf rom
Canada.Expl
ainhowt he
setwoindi
vidual
swi l
lb e
tax
edinCa na
da .
2
2. I tisp oss
ibl
ethata nindi
vid
ualcoul
db e
cons
ide
redresi
denti
nmor etha
non ecoun
try
.In
suchsit
uat
ion
s,"ti
e-
break
er"rul
esa r
eu sedto
avoi
dtheindi
vi
dualbei
ngs u
bjec
ttotaxa-
ti
onin
FPr
obl
emOne-1
I
n
tr
odu
ct
io
n-Es
sayQu
est
i
ons
CHAPTERONETESTI
TEM FI
LE
PROBLEMS
TI
FPROBLEM ONE-1
I
NTRODUCTI
ON-ESSAYQUESTI
ONS
1
.Themaj
orsou
rceoffe
der
alrev
enuesisthe
per
son
ali
ncometax.I
ndi
cat
ethreeot
hertyp
esof
ta
xest
hatc
ontri
but
etofed
eralr
evenu
e s
.
2
.Whati
sth
emean
ingof"
per
son
"wh
ent
het
ermi
sus
edi
n
th
eInc
omeTa
xAct?
3
.Br
ief
lydescr
ibet
heprocedu
resusedi
ncalc
ula
tin
g
pr
ovi
n c
ial
incometax
e sf
orind
ivi
dual
sin
pr
ovi
n c
esothert
hanQu e
bec.
4
.TheCanadi
anincometaxsys
temisoft
enuse
dto
ac
h i
eveva
riouseconomi
cobjec
ti
ves.
Givet
hree
ex
a mpl
esthatil
l
ustr
atet
hispoi
nt.
5
.Provi
deanexa
mp l
eofhowtaxa
tionp
oli
cyc
anb
eus
edt
o
in
flu
encere
sourc
eall
ocat
ion
.
6
.Theg over
nmentp a
ysa" c
hil
dta xbe n
efi
t"tot
he
pare
ntsofc h
il
drenwhoareunder18y ear
sofage.
Thep aymentsarer e
ducedbyap er
centa
geof
in
come i ne xc
ess ofa s pec
ifi
edl evel
.Wh a
t
obj
ectiv
esareachie
vedbythi
sben e
fitsys
tem?
,7
.In
d i
cat
ethre
ed i
sad
van
tag
esofat
axs
yst
emt
hatu
ses
progr
essi
verat
es.
8
.Aregre
ssiv
etaxisonetha
ttaxe
shi
ghincome
in
divi
dual
satlowere
ffec
ti
verat
es.
Expl
ainwhya
sal
estaxle
vie
da taf
latr
ateof8per
cen
tc a
nbe
regr
essi
ve.
9
.Dis
ti
ngui
shbet
weenh
ori
zon
tal
equi
tyandver
ti
cal
equi
tya
sthe
seter
msareus
edind
e-sc
ri
b i
ngtax
syst
ems.
1
0. Wh atar
es omeoft
hefact
orsth
atha
vel
edt
o
thee
ntr
enchedu s
eofta
xe x
pendi
tur
esa
sop-
pose
dtop r
ogra
ms p
endi
ng?
1
1. Wh i
l
etheSecti
onsoftheIn
comeTaxActar
e
numb
ered1throu
gh2 6
0,the
reareact
uall
ymore
th
an260Sec
tions.E
xplai
nwh yt
hisi
sthecas
e.
1
2. Wh atpu
rpos
esa
res
erv
edb
yCa
nad
a'si
nte
rna
tion
al
ta
xtr
eat
ie
s?
1
3. L i
stfourn
on-
l
egi
sl
ati
ves
our
cesofi
ncomet
ax
in
for
mation.
1
4. Wh ati
sth
eme a
nin
gof"t
axa
tiony
ear
"ast
hep
hra
se
isu
sedi
nth
eInco
meTaxAct
?
1
5. Un de
rwh a
tci
rc
ums t
anc
eswil
lape
rsonwh
o
isn
otresi
denti
nCanadaber
equ
ire
dtopay
Canad
ianinc
ometaxe
s?
1
6. Wh ati
stheimp
ort
anc
eofr
esi
den
cei
nCa
nad
ian
in
comet
axa
tion
?
,1
7. Wh enanindi
vidualle
avesCa n
a d
a,theCRA
maytakethep osi
ti
ont hatheh asreta
inedhis
re
sid
encesta
tus
.Wh atarethepri
maryfac
tor
sthat
th
eCRAwi l
lcon
s i
derindeter
mini
ngwh et
hersuc
h
anin
div
idua
lhas,i
nf a
c t
,ceasedtobeaCa na
dia
n
re
sid
ent?
1
8. L i
stth
reefac
tor
stha
twou l
db econ
sid
eredi
n
thed
eter
minati
onofwhet
herornotanin
di-
vi
dual
isar
eside
ntofCanada
.
b
lac
kdo
ll
ar
4st
uvi
a
1
, TI
FPr
obl
emOn
e-1
I
ntr
odu
cti
on-
Ess
ayQu
est
io
ns
1
9. I fa n i ndi
vid
uall eaves Ca na
daf or a
te
mp orar
ya bsence,thi
sr ai
sest hequ est
ionof
whetherhewa saCa nadi
anr esi
d e
ntd ur
ingt he
per
iodofa bsence,par
ti
cula
rlyifsomer es
identi
al
ti
esh aveb eenr etai
ned.Wh ata ret he major
fa
ctorsthatar
ec onsi
dere
dind ete
rminingwh e
ther
anindiv
idualconti
nuestobeaCa nadi
anres i
dent
dur
ingatemp orar
ya bs
ence?
2
0. On eofy ourfr
ien
dsi sl
eavi
ngCa nadaand
wouldli
ket oknow whenh ewillnolongerbe
consi
der
edaCa nadi
anresi
den
t.Bri
efl
yexpl
ai
nthe
rul
esrel
ate
dt oter
minat
inganind
i-v
idua
l'
sstat
us
asaCa n
adianre
side
nt.
2
1. F orthecurr
entyear
,JaneDoeisdeemedt oa
Canadi
anr esidentb e
causes hes oj
ou r
nedi n
Canadafor2 10d ay
s.Alsoforthec u
rrentye a
r,
JackFawn,along-t
imeresi
dentofMani-
toba,wa s
consi
deredap artyearres
iden
tforthef i
rst2 1
0
days,aft
erwh i
chh ep e
rmanent
lydepart
edf rom
Canada.Expl
ainhowt he
setwoindi
vidual
swi l
lb e
tax
edinCa na
da .
2
2. I tisp oss
ibl
ethata nindi
vid
ualcoul
db e
cons
ide
redresi
denti
nmor etha
non ecoun
try
.In
suchsit
uat
ion
s,"ti
e-
break
er"rul
esa r
eu sedto
avoi
dtheindi
vi
dualbei
ngs u
bjec
ttotaxa-
ti
onin
