Reference no: EM132897434

Question - Ms. Amy Andrews is 57 years old and lives in Surrey, British Columbia. She works in the income tax department of a large furniture chain.

Ms. Amy Andrews's Personal Information:

1. Ms. Amy Andrews was divorced and had custody of her 12-year-old daughter, Alice. In 2019, Alice had Net Income for Tax Purposes of $3,300. The $3,300 was comprised 100% of interest income, which was earned on bonds acquired from an inheritance. Alice's medical condition qualified Alice for the disability tax credit.

2. In 2019, Ms. Amy Andrews installed access ramps in her home, to assist Alice in getting around. The access ramps cost $26,000.

3. Ms. Amy Andrews, during 2019, volunteered 450 hours as a search and rescue volunteer. She received $540 in compensation for this work.

4. Ms. Amy Andrews's 74-year-old mother, Doris, lived with Ms. Amy Andrews. Doris provided care for Alice on a full-time basis. In 2019, Doris had $10,000 Net Income for Tax Purposes.

5. Ms. Amy Andrews incurred the following medical expenses in 2019:

6. Ms. Amy Andrews, during 2019, donated $9,000 to the United Way, a registered Canadian charity. She has made various donations to the United Way in prior years.

Employment Information:

1. In 2019, Ms. Amy Andrews's salary was $180,000, none of which involved commissions. Federal income tax of $46,000 was withheld. Furthermore, she was awarded a year-end bonus of $35,000, payable in 2020.

2. Ms. Amy Andrews and her employer each contributed $5,200 to a defined benefit registered pension plan.

3. Ms. Amy Andrews's employer offered to pay the tuition for employees taking language courses. Consequently, in 2019, Ms. Amy Andrews enrolled in a French class. Ms. Amy Andrews's employer paid the $5,400 tuition fees for Ms. Amy Andrews's French course. The $5,400 amount was included in Ms. Amy Andrews's employment income as a taxable benefit, which was in addition to the $180,000 salary that Ms. Amy Andrews received. The French course was for 11 months and included 12 hours of classes per week. Ms. Amy Andrews personally paid $635 for her own textbooks.

4. Ms. Amy Andrews was provided with disability insurance by an employer-sponsored plan. Commencing in 2015, Ms. Amy Andrews contributed $500 per year to the plan's coverage, and her employer made matching contributions each year. As a result of an accident in 2019, Ms. Amy Andrews was unable to work for 4 months; thus, she received $12,000 under this plan.

5. Ms. Amy Andrews's employer provided Ms. Amy Andrews with an automobile. The automobile was acquired by the company several years ago at a total cost of $80,000. During 2019, the automobile was driven 50,000 kilometres, 10,000 of which were for employment-related travel. Excluding the 4 months when Ms. Amy Andrews was off work due to the accident, the automobile was available to Ms. Amy Andrews throughout 2019. During the 4 months when Ms. Amy Andrews was off work, the automobile was left at her employer's parking lot. In 2019, Ms. Amy Andrews paid $14,000 in operating costs, since her employer required her to pay her own operating costs.

6. Ms. Amy Andrews's employer provided all of its employees with financial counselling services. Ms. Amy Andrews's cost to the employer was $1,500.

7. Ms. Amy Andrews received a $20,000 performance award in December 2019, which was in addition to the $180,000 salary.

8. On June 15, 2017, Ms. Amy Andrews received options to acquire 500 of her employer's stock [a public company] at a price of $25 per share. At that time, the shares were trading at $25 per share. Ms. Amy Andrews exercised these options on August 11, 2019, when the shares were trading at $30 per share. Ms. Amy Andrews was still holding these shares at December 31, 2019, since she did not plan on selling the shares for several years.

9. In order to assist Ms. Amy Andrews in acquiring a cottage in Abbotsford, her employer gave her a 5-year, interest free loan of $300,000. The loan was granted on February 01, 2019 and, at this point in time, the interest rate on open 5-year mortgages was 5%. Assume the prescribed rate was 2% on this date and remained unchanged during the year. Ms. Amy Andrews purchases a cottage for $400,000 on February 01, 2019.

10. During 2019, Ms. Amy Andrews spent $19,300 on employment-related meals and entertainment with clients of her employer. Her employer reimbursed $10,000 of these costs.

11. During 2019, Ms. Amy Andrews receives several gifts from her employer:

As a reward for winning the company's Employee of the Month award, she received an expense paid weekend in a local hotel, which cost the company $4,400.

Ms. Amy Andrews received a $700 gift certificate for merchandise at a local department store, as was the case for all of the company's employees.

At Christmas, the company gave each employee a basket of fancy chocolates, which cost the company $400.

Required - Calculate Ms. Amy Andrews's 2019 net income, taxable income, and federal income tax payable. Ignore GST and PST considerations.