Which is not a requirement for a business to qualify

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Problem 1: Which of the following statements with respect to the Tax On Split Income (TOSI) is correct?

A. A Specified Individual s holding of private company shares will be classified as Excluded Shares if their fair market value is equal to or greater than 10 percent of the fair market value of all of the company s shares.

B. A Specified Individual can only claim that dividends are from an Excluded Business if they are actively engaged in the business during the current taxation year.

C. Specified Individuals under the age of 18 can never claim that income received is from an Excluded Business.

D. Potential Split Income received by any Specified Individual can be an Excluded Amount, provided it is reasonable in terms of the individual s labour, capital, or risk contribution to the source business.

E. None of the above

Problem 2: Which of the following is NOT a requirement for a business to qualify as a qualified small business corporation?

A. At the time the shares are sold, the corporation must use all or substantially all of its assets for active business purposes in Canada.

B. More than 50 percent of the fair market value of the assets of the business must have been used for active business in the past 24 months.

C. The shares must not have been owned by a related individual in the past 24 months.

D. The shares must not have been owned by a non-related individual in the past 24 months.

E. None of the above

Reference no: EM132724396

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