UNIVERSITY OF ALBERTA

SCHOOL OF BUSINESS
DEPARTMENT OF ACCOUNTING, OPERATIONS AND
INFORMATION SYSTEMS
Accounting 467/667
Basic Income Tax
Fall 2014
_____________________________________________________________________________
Instructor:
David Rusnacik CA, MPAcc
Lecture X1
Class:
Tuesday evenings 6:00 p.m. to 9:00 p.m.
Office Hours: Available by appointment only
Email:
davidr@ualberta.ca
_____________________________________________________________________________
OFFICE HOURS
By appointment only. You may also attend Professor Loretta Amerongens office hours which
are Tuesday and Thursday from 1:00 - 2:30. Her office is located on the 4th floor in the School
of Business (4-21G).
REQUIRED MATERIALS
Textbook: C. Byrd, I. Chen. Canadian Tax Principles, 2014 - 2015 Edition, Prentice Hall Canada
Inc., Scarborough, Ontario, 2014.
The use of older versions of the textbook is not recommended due to changing tax rates and
legislation.
Course Package: The course package contains notes to be used in class as a basis for
lectures. The course package is available through the Accounting club office.
PREREQUISITE
Accounting 414, 412, 614 or 612.
You must have successfully completed the prerequisite prior to taking this course. It is expected
that you will have a sound knowledge of accounting principles (GAAP).
LEARNING OBJECTIVES
This course incorporates the Learning Goals of the BCom Program, in particular Critical Thinking
and Quantitative Skills. The course is designed to achieve the following objectives:
(1) To explain the theoretical concepts behind the specific provisions of the Income Tax Act.
(2) To apply the law in practical and case settings.
(3) To introduce basic tax planning concepts through practical problem application.

At the end of this course, you will have the knowledge required to prepare a complex personal
tax return for an individual; determine net income for tax purposes for a corporation, and
address tax planning opportunities at an introductory level.
APPROACH TO MATERIALS
The best way to learn and understand tax law is to apply the rules to problems. The textbook
provides three types of problems: exercises, self-study problems, and assignment problems.
The solutions to the exercises and self-study problems are included with the text book.
Solutions to relevant assignment problems will be posted on the u Learn site. In order to master
the material, you should practice all available questions.
When practicing questions, you should prepare a complete answer before looking at the
solution. Simply reviewing the solution will not be sufficient preparation for exams. The solution
should be reviewed with the objective of identifying key concepts or principles underlying the
tax treatment of various items. The ability to identify an issue and quickly understand the
required approach will save valuable time in exam situations.
PREVIOUS EXAMS
Prior to each of the two midterms and the final exam, I will provide a sample of previous exam
questions. These will include updated solutions that reflect current tax legislation. Solutions to
old exams other than the samples noted above will not be provided as tax legislation changes
substantially from time to time especially tax rates and solutions to old exams do not reflect
current legislation.
EXAMS
Prior to each exam, I will hand out an information sheet about the exam. In order to ensure
fairness, you may ask any questions you wish about exam content in class; however I reserve
the right to decide whether I will answer a particular question.
EVALUATION
Your grade in the course will be based on the marks you obtain on two midterms and a final
exam. The marks will be weighted as follows:
Midterm I
Midterm II
Final Exam

25 %
25 %
50 %

EXAM DATES
Midterm I
Midterm II
Final Consolidated

Wednesday, October 8th at 5:00PM

Wednesday, November 5th at 5:00PM
Saturday, December 6th at 9:00AM

The midterm examinations and the final will be consolidated with the day time sections of the
course. The midterm examinations will be held starting at 5:00 PM on the dates specified
above. Midterm examination dates given above are tentative and may be changed. In any
event, no exam will be held prior to the dates specified above.
Any student who continues to write after time is called for the exam will be penalized.
All exams are closed book. For each exam, I will provide a formula sheet that will be
distributed at the exam. You are required to sign the formula sheet in the space provided and
turn it in with your exam. No writing is permitted on the formula sheet. There is a five mark
penalty for any of the following:
Writing on the formula sheet
Not signing the formula sheet, or,
Not turning the formula sheet in with the exam
A copy of the formula sheet to be used for a particular exam will be posted on the course
website in a timely basis before the exam so that it can be used while you practice problems
prior to the exam.
The final exam is cumulative from employment income to the end of the course notes.
Students must be able to present their student ID cards or other acceptable photo
identification. Smart phones and any other electronic devices must remain turned off and put
away prior to the examination. The only permitted electronic devices are non-programmable
calculators.
GRADES IN THE COURSE
The University average grade distribution is based on all courses across campus including
courses of varying levels of difficulty. A curve is used to determine the final grade distribution
for this course with natural break points used to distinguish between various grades. As a
result, the distribution of grades in this course will not necessarily coincide exactly with the
University average distribution. Traditionally the median grade in this course has been a B-.
CLASSROOM ETIQUETTE
Attendance: It is your responsibility to attend class. If you miss class for any reason, you are
still responsible for all materials covered, announcements made and handouts provided.
Smart phones and other electronic devices: All smart phones and other electronic
communication devices must be turned off for prior to class. Text messaging or emailing, after
the start of class, is not permitted under any circumstances as it is very disruptive. Audio or
video recording of lectures is allowed only with prior written consent of the instructor or as part
of an approved accommodation plan.
Laptops: As the course package notes will not be available in electronic format, laptops will not
be required for the purposes of taking notes. In order to avoid distraction to students around
you, no laptops should be used during class unless a documented medical reason is provided.

ABSENCES AND MISSED WORK

If you are absent from a midterm exam for an acceptable reason (illness or family emergency)
you are required to send an email to me informing me that you were unable to attend the
midterm and explaining the nature of your difficulty. I may, at my discretion, require proof
supporting your stated reason for missing the midterm, either in the form of a statutory
declaration or other supporting documentation (email format is not acceptable hard copies
must be provided with an original signature). I follow the policy of sending all requests for
deferral to the undergraduate office. In the event that either midterm examination is missed for
an acceptable reason, no make-up will be given. Instead, the credit assigned to that mid-term
will be reallocated to the final.
Please remember that it is your responsibility to ensure that any travel arrangements do not
conflict with the outlined exam schedules.
If you miss the final exam, you must apply to the undergraduate office for an exam deferral. In
the event that you are granted a deferral, the deferred exam will be held on Friday, January 16,
2015 at 9:00 am.
SUCCESS IN THE COURSE
In order to do well in the course, you will have to commit a significant amount of time to
learning the material. In order to be successful, consider doing the following:
Attend all lectures.
Review all of the lecture notes.
Complete all the textbook readings (Do not summarize the text there is no time and
little benefit to doing so).
Practice all of the problems including exercises, self-study, assignment problems and
additional problems from old exams posted in the course website.
When reviewing solutions to practice problems, consider making notes of items missed
and determine the correct treatment by identifying why your treatment is wrong and the
solution treatment is correct.
IN CLASS NOTES AND HANDOUTS
It is your responsibility to ensure that you pick up all handouts. I will not, under any
circumstances, email any class handouts. Furthermore, if you miss a class, it is your
responsibility to obtain the notes from another student.

Please note: There will be no class November 11th (Remembrance Day)

Detailed Topical Coverage

Prior to doing the assigned readings, you should review the learning objectives at the beginning
of each relevant chapter.

Topic

Reading

Introduction*

1-1 to 1-10; 1-13 to 1-17; 1-26 to 1-90; 1-100 to 1-149; 2-87 to

2-112; 2-116 to 2-135

Employment

3-1 to 3-220; 6-121 to 6-128; 10-210 to 10-217

Retirement Savings

10-1 to 10-209

CCA and CEC

5-1 to 5-108; 7-61 to 7-69

Business

6-1 to 6-91; 6-94 to 6-103; 6-106 to 6-153; 6-159 to 6-168; 6173 to 6-181; 11-63 to 11-67

Capital Gains

8-1 to 8-32; 8-34 to 8-90; 8-105 to 8-133; 8-137 to 8-168; 11-30

to 11-35; 11-55 to 11-62; 11-68 to 11-72

Property

7-1 to 7-60; 7-70 to 7-100; 7-118 to 7-141

Other income and

other deductions

9-1 to 9-4; 9-11 to 9-96; 9-136 to 9-140; 4-222 to 4-232

Taxable Income and

Tax Payable

11-6 to 11-7; 11-14 to 11-29; 11-36 to 11-49; 11-98 to 11-105;

4-1 to 4-125; 4-130; 4-146; 4-151 to 4-158; 4-163 to 4-197; 4233; 11-125 to 11-150; 7-142 to 7-143

You are responsible for all assigned textbook readings, whether or not they are covered in
class.

Basic Tax
List of Applicable Problems

Self-Study Problems

Assignment Problems
Introduction
1-2 to 1-5; 1-7 to 1-8

1-1 to 1-7; 2-6

3-1 to 3-13; 6-5

Employment Income
3-1 to 3-14; 6-3

10-1 to 10-5; 10-6 [Part a) and b)]

Retirement Savings
10-1 to 10-7

5-1 to 5-8; 7-2

Capital Cost Allowance and Cumulative Eligible Capital

5-1 to 5-8; 7-2; 7-3

Business Income
6-1 to 6-14; 6-15,6-16 (only calculated net
6-1 to 6-11; 6-12 (only calculate net income
income for tax purposes for 6-15,-6-16)
for tax purposes)
Capital Gains
8-1; 8-3 to 8-5; 8-7; 8-8; 8-10 to 8-12; 8-14 to
8-1; 8-4 to 8-8; 8-9; 8-10; 8-11; 8-13; 8-14;
8-16; 11-1
11-2
Property Income
7-1 to 7-6; 7-7 (just do part on mutual funds)
7-1; 7-4; 7-5; 7-7
9-1 to 9-6

Other Income and Other Deductions

9-1 to 9-4; 9-5 (ignore RESP)

Taxable Income and Tax Payable

4-1 to 4-7; 11-2; 11-4; 11-5 11-7; 11-8; 11-10
4-1 to 4-6; 11-1; 11-4; 11-6 to 11:9; 6-12; 6-13;
6-15; 7-8; 7-9; 8-17; 8-18; 9-13; 9-14 (ignore
7-8; 7-9; 8-15; 8-16; 9-12; 9-13; 10-8; 10-9
attribution); 10-7; 10-8 to 10-10