Net income / Small business deduction
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NetIncome
NetIncome must be entered by you. DT Max will use this amount as net income for tax purposes. If adjustments to the net income entered exist due to items entered in this group or other groups, DT Max will calculate net income for tax purposes on schedule 1 (T2S(1)).
TaxProvision
The TaxProvision from the financial statements entered here will be added back to net income schedule 1 (T2S(1)).
The following options are applicable for the keyword TaxProvision.
- Provision for taxes - current
- Provision for taxes - deferred
Depreciation 
Enter the depreciation and amortization deducted in the financial statements here. The amount entered will be added back to net income on schedule 1 (T2S(1)).
Capital cost allowance and cumulative eligible capital deductions will be calculated based on information entered in the CCA-Class group.
The following options are applicable for the keyword Depreciation.
- Tangible assets
- Natural resource assets
- Intangible assets
Net-Inc-Add
Use the keyword Net-Inc-Add to enter additions to net income (loss) per financial statements. These amounts will be shown on schedule 1 (T2S(1)), and the CO-17.A.1 as positive amounts.
The following options are applicable for the keyword Net-Inc-Add.
- Accrual inventory - opening
- Accruals/payables - cash basis - closing
- Accrued dividends - prior year
- Amount received - environmental trust
- ARTC received in the current year
- Averaged inc. from sale of timber - prior year
- Book loss of joint venture/partnership
- Capital items expensed
- Capitalized interest
- Capital tax liability
- Contractors' completion method adj. - previous year
- Correction to supp. deduction for new investments
- Crown charges, royalties and rentals
- Debt issue expense
- Deemed dividend income
- Deemed interest received
- Deemed interest on loans to non residents
- Deferred and prepaid expenses
- Development expenses claimed in current year
- Dividends credited to the investment account
- Dividend stop-loss adjustment
- Eligible capital expenditures - Qc
- Exploration expenses claimed in current year
- Financing fees deducted in books
- Foreign accrual property income
- Foreign affiliate property income
- Foreign exchange included in retained earnings
- Gain on settlement of debt
- Holdbacks receivable
- Income from joint venture, partnership
- Income tax interest and penalties
- Interest on leasing-purchase contracts - Qc
- Interest paid on income debentures
- Inventory depreciation - current year
- Loss from disposal of assets
- Loss from disposal of other assets - Qc
- Loss from international banking centres
- Loss from joint venture, partnership
- Loss in equity of subsidiary, affiliate
- Mandatory inventory adjustment - current year
- Total meals and entertainment expenses
- Portion meal exp. of truck drivers 19/03/07 to 31/12/07
- Portion meal exp. of truck drivers incurred in 2008
- Portion meal exp. of truck drivers incurred in 2009
- Portion meal exp. of truck drivers incurred in 2010
- Portion meal exp. of truck drivers incurred after 2010
- Portion of meal expenses due to regular travel - Qc
- Portion of meal expenses from sales agencies - Qc
- Mining royalties (provincial mining taxes)
- Non deductible advertising
- Non deductible car loan interest
- Non deductible car leasing expenses
- Non deductible carrying charges for land - Qc
- Non deductible club dues and fees
- Non deductible fines and penalties
- Non deductible interest
- Non deductible legal and accounting fees
- Non deductible life insurance premiums
- Overcontributions to company pension plan
- Optional inventory adjustment - current year
- Other expenses from financial statements
- Receivables/prepaid - cash basis - opening
- Renovations/transform. toward access to building - Qc
- Reserves from statements - ending of year
- Resource deduction in books
- Taxable/non-deduct. other comprehensive income items
- Total SR&ED expenses deducted in fin. statements
- Portion of R&D exp. from wages paid for support - Qc
- Portion of R&D exp. from amts paid to subcontractors in Qc
- Portion of R&D exp. from other expenditures - Qc
- Portion of R&D exp. from R&D report preparers fees - Qc
- Sales tax assessments
- Shares issue expense
- Soft costs - building construction, renovation
- Work in progress at end of previous yr - Qc
- Write-down of capital property
- Other additions - specify
The current year Alberta royalty tax credit (ARTC) is not to be included in federal income for that same taxation year. Instead, the ARTC paid to the corporation should be included in income in the year the income is received.Enter the Alberta royalty tax credit (ARTC) which has been received by the corporation in the current year.
Enter the portion of income from the sale of timber on woodlots affected by the Quebec ice storm that may be deducted from income, i.e., the deferred amount, as a negative amount.Enter the deferred amount that must be added back to income no later than the fifth year following the year of the deduction as a positive amount.
Enter fixed asset expenses capitalized in the financial statements which are tax-deductible here. The amount entered will be deducted from income.On the fixed asset reconciliation schedule, if printed, the deductible expenses capitalized in the books entered here will be added to the change in fixed assets per the tax return. Use the FixdAssetRec keyword group to enter information for the reconciliation schedule and DT Max will print this schedule.
Income tax interest and penalties are not deductible from income for tax purposes. The amount entered here will be added back to net income on schedule 1 (T2S(1)).
The book gain (loss) on disposal of depreciable assets adjusts income on schedule 1 (T2S(1)). Gains will be deducted from income and losses added back.On the fixed asset reconciliation schedule, if printed, the book gain or loss will also adjust the change in fixed assets per the tax return. Use the FixdAssetRec keyword group to enter information for the reconciliation schedule and DT Max will print this schedule.
The book gain (loss) on disposal of other assets adjusts income as follows: gains are deducted from income and losses added back.
Enter 100% of the meals and entertainment expenses here; DT Max will calculate the deductible portion.Meals and entertainment expenses incurred after February 21, 1994, are 50% deductible federally and provincially.
For Quebec, the deduction for meals and entertainment expenses will be limited at an amount equal to 1% of gross income for the taxation year ending before March 31, 2004. If the taxation year ends after March 30, 2004, the deduction for meals and entertainment depends on the amount of gross income for the taxation year, i.e. if the gross income is $32,500 or less, the deduction will be limited to 2%; if the gross income is more than $32,500 but less than $52,000, the deduction will be limited to $650; and if the gross income is $52,000 or more, the deduction will be limited to 1.25%.
Portion of the meal expenses consumed by long-haul truck drivers on or after March 19, 2007 and before January 1, 2008 will be deductible at a rate of 60%.
Portion of the meal expenses consumed by long-haul truck drivers during 2008 will be deductible at a rate of 65%.
Portion of the meal expenses consumed by long-haul truck drivers during 2009 will be deductible at a rate of 70%.
Portion of the meal expenses consumed by long-haul truck drivers during 2010 will be deductible at a rate of 75%.
Portion of the meal expenses consumed by long-haul truck drivers after 2010 will be deductible at a rate of 80%.
Portion of the meal expenses (food and beverage) that are incurred by a taxpayer through business-related activities, if they occur 40 km or more from the taxpayer's place of business. These activities must be regularly carried out in a location that far from the place of business. These expenses are 50% deductible.
These non deductible auto expenses include allowances paid to employees which are in excess of the deductible limits for tax purposes. The amounts entered here will be added back to net income on schedule 1 (T2S(1)).
Non deductible land carrying charges include interest and property taxes paid on vacant land in excess of the revenue earned on the land when exceptions relating to the use of the land and the corporation's business are not met. An amount entered here will be added to income on the CO-17.A.1.
Club dues and fees are not deductible from income for tax purposes where the main purpose of using the club facilities is for dining, sports, or other recreational purpose. The amount entered here will be added back to net income on schedule 1 (T2S(1)).
Section 67.6 prohibits deductions for fines and penalties, including municipal parking tickets. It does not apply to interest, including interest on penalties.
Enter the amount of non deductible over-contributions to the company pension plan here. The amount entered will be added back to income.The amount of deducted contributions to pension and other deferred income plans must be disclosed on schedule 15 (T2S(15)). Use the DeferIncPlan keyword group to indicate such contributions. DT Max will then produce a schedule 15 (T2S(15)) based on the information entered.
Enter other expenses capitalized in the financial statements which are taxable here. The amount entered will be added back to income.
Enter SR&ED expenses deducted in the financial statements here. The amount entered will be added back to income.For tax purposes, schedule 32 (T661) detailing the claim for SR&ED expenditures in Canada will result in a deduction from income on schedule 1 (T2S(1)). Use the CCA-Class group and choose the SR&ED option (current or capital) to enter the claim being made. Enter the relevant ITC code in the ITC-CODE keyword to claim the investment tax credit or refund on schedule 31 (T2038).
Enter generally any expenses known as "soft costs" incurred during the alteration, construction or renovation of buildings and which must be capitalized. The amount entered will be added to income.
Net-Inc-Ded
Use the keyword Net-Inc-Ded to enter deductions from net income (loss) per financial statements. These amounts will be shown on schedule 1 (T2S(1)), and the CO-17.A.1 as positive amounts.
The following options are applicable for the keyword Net-Inc-Ded.
- Accrual inventory - closing
- Accruals/payables - cash basis - opening
- Accrued dividends - current year
- Additional deduction for new investments
- Amount paid - environmental trust
- Averaged inc. from sale of timber - current year
- Bad debts
- Book gain on debt settlement - Qc
- Book income of joint venture/partnership
- Contractors' completion method adj. - current year
- Deductible Crown charges - resource
- Deferred and prepaid expenses
- Exempt income under ITA 81
- Financial expenses - Qc
- Foreign tax (146.1 deduction) - Qc
- Gain from disposal of assets
- Gain from disposal of other assets - Qc
- Gain in equity of subsidiary, affiliate
- Holdbacks payable
- Income from international banking centres
- Inventory depreciation - prior year
- Mandatory inventory adjustment - prior year
- Non-Canadian advertising - broadcasting
- Non-Canadian advertising - printed materials
- Non-tax./deductible other comprehensive income items
- Optional inventory adj. - prior year
- Other income from financial statements
- Prov. cap. tax capitalized in fin. statements
- Quebec credits not subject to income tax
- Receivables/prepaid - cash basis - closing
- Renovations/transform. toward access to building - Qc
- Reserves from statements - beginning of year
- Share issue expenses - Qc
- Tax relief from transit passes for employers - Qc
- Work in progress at end of current yr - Qc
- Other deductions - specify
Taxpayers who carry on part of their business in Quebec and part of it outside Quebec may claim an additional deduction of 20% of the deduction for depreciation regarding certain assets. These include M&P equipment, computer hardware, or foreign ore processing equipment. The amount entered here will be deducted from income.
Enter provincial capital tax which was capitalized in the financial statements (charged to a tax liability account) and paid in the year here. The amount entered will be deducted from income.
Enter any Quebec credits (i.e. manpower training credits) that are not subject to income tax here. The amount entered here will be deducted from income.
Tax-Credit-Add
Use the keyword Tax-Credit-Add to enter taxable tax credits added to net income (loss) per financial statements. These amounts will be shown on Quebec form CO-17.A.1.
The following options are applicable for the keyword Tax-Credit-Add.
- 001 Losses in regard of a previous year loss
- 002 Salaries and wages (SR&ED)
- 003 University research (SR&ED)
- 004 Pre-competitive research (SR&ED)
- 005 Losses in regard of a current year loss
- 006 Taxi business
- 007 Forest producers property tax refund
- 008 Training
- 009 On-the-job training
- 010 Design consulting - outside contract
- 011 Québec film production
- 012 Multimedia titles
- 013 Capitalisation des PME
- 014 Shipbuilding
- 015 Ship transformation
- 016 Dues/fees paid to research consortium
- 017 Design consulting - internal
- 018 Job creation
- 019 Reporting of tips
- 020 Wages - innovative project
- 021 Purchase/location of property - CDTI
- 022 Less polluting technology uses
- 023 Tax paid by environmental trust
- 024 Film dubbing
- 025 Specialized employees training - CFI
- 026 Solicitation expenditures - CFI
- 027 Portfolio managers
- 028 Investment fund creation
- 029 Film production services
- 030 Clothing/footwear industry job creation
- 031 Wages - Cité du multimédia
- 032 Large corporations
- 033 Railway companies
- 034 Additional tax credit for SR&ED
- 035 Technological adaptation services
- 036 CNNTQ established corporations
- 037 Wages - NEC or CDB
- 038 Acquisition fees - NEC or CDB
- 039 Wages - SDZCIMM
- 040 Customs brokerage services - SDZCIMM
- 041 Acquisition or leasing of equipment - SDZCIMM
- 042 Sound recordings
- 043 Musical productions
- 044 Apprenticeship of new employees - CO
- 045 Electronic trading solutions
- 046 Aluminium valley
- 047 Angus Technopole
- 048 Book editing
- 049 Salaries - CCE
- 050 Promotion with investors
- 051 Hiring of junior financial analysts
- 052 Building of strategic structures - ZCIMM
- 053 Maintenance of race horses
- 054 Numerical shows
- 055 Salairies - corp. in Gaspésie/Qc maritime area
- 056 Foreign investment fund - IFC
- 057 Processing in resource areas
- 058 Mining exploration expenses
- 059 Corporaion in the Cité de la biotechnologie
- 060 Specific hiring of specialized installations
- 061 Hiring of junior financial analysts - DFI
- 062 Stock brokers with the Nasdaq
- 063 Electronics business
- 064 Modernization of the taxi fleet
- 065 Biotechnology development
- 066 Nutraceuticals and functional foods
- 067 Innovation centres
- 068 On-the-job training - Emploi Québec
- 069 Mineral resources
- 070 New graduates hiring
- 071 Building of access roads and public bridges
- 072 Job creation - resources areas
- 073 Job creation - designated area
- 074 Québec ethanol production
- 075 Major employment generating projects
- 076 Capital for investments
- 077 Construction of access road
- 078 Pig manure processing Installation
- 079 Pre-competitive research in private partnership
- 080 Training in the manufaturing sector
- 081 Training in French
- 082 Job creation in the resource regions
- 083 Job creation - Aluminium Valley
- 084 Job creation - Gaspésie/Maritime regions
- 085 Investment
- 086 E-business development
- 301 Foreign tax - current year
- 302 Foreign tax - previous year
- 303 Environmental trust
- 304 Designated trust
- 305 Financial tools specialized employees
- Select
Tax-Credit-Ded
Use the keyword Tax-Credit-Ded to enter non-taxable tax credits deducted from net income (loss) per financial statements. These amounts will be shown on Quebec form CO-17.A.1.
The following options are applicable for the keyword Tax-Credit-Ded.
- 001 Losses in regard of a previous year loss
- 002 Salaries and wages (SR&ED)
- 003 University research (SR&ED)
- 004 Pre-competitive research (SR&ED)
- 005 Losses in regard of a current year loss
- 006 Taxi business
- 007 Forest producers property tax refund
- 008 Training
- 009 On-the-job training
- 010 Design consulting - outside contract
- 011 Québec film production
- 012 Multimedia titles
- 013 Capitalisation des PME
- 014 Shipbuilding
- 015 Ship transformation
- 016 Dues/fees paid to research consortium
- 017 Design consulting - internal
- 018 Job creation
- 019 Reporting of tips
- 020 Wages - innovative project
- 021 Purchase/location of property - CDTI
- 022 Less polluting technology uses
- 023 Tax paid by environmental trust
- 024 Film dubbing
- 025 Specialized employees training - CFI
- 026 Solicitation expenditures - CFI
- 027 Portfolio managers
- 028 Investment fund creation
- 029 Film production services
- 030 Clothing/footwear industry job creation
- 031 Wages - Cité du multimédia
- 032 Large corporations
- 033 Railway companies
- 034 Additional tax credit for SR&ED
- 035 Technological adaptation services
- 036 CNNTQ established corporations
- 037 Wages - NEC or CDB
- 038 Acquisition fees - NEC or CDB
- 039 Wages - SDZCIMM
- 040 Customs brokerage services - SDZCIMM
- 041 Acquisition or leasing of equipment - SDZCIMM
- 042 Sound recordings
- 043 Musical productions
- 044 Apprenticeship of new employees - CO
- 045 Electronic trading solutions
- 046 Aluminium valley
- 047 Angus Technopole
- 048 Book editing
- 049 Salaries - CCE
- 050 Promotion with investors
- 051 Hiring of junior financial analysts
- 052 Building of strategic structures - ZCIMM
- 053 Maintenance of race horses
- 054 Numerical shows
- 055 Salairies - corp. in Gaspésie/Qc maritime area
- 056 Foreign investment fund - IFC
- 057 Processing in resource areas
- 058 Mining exploration expenses
- 059 Corporaion in the Cité de la biotechnologie
- 060 Specific hiring of specialized installations
- 061 Hiring of junior financial analysts - DFI
- 062 Stock brokers with the Nasdaq
- 063 Electronics business
- 064 Modernization of the taxi fleet
- 065 Biotechnology development
- 066 Nutraceuticals and functional foods
- 067 Innovation centres
- 068 On-the-job training - Emploi Québec
- 069 Mineral resources
- 070 New graduates hiring
- 071 Building of access roads and public bridges
- 072 Job creation - resources areas
- 073 Job creation - designated area
- 074 Québec ethanol production
- 075 Major employment generating projects
- 076 Capital for investments
- 077 Construction of access road
- 078 Pig manure processing Installation
- 079 Pre-competitive research in private partnership
- 080 Training in the manufaturing sector
- 081 Training in French
- 082 Job creation in the resource regions
- 083 Job creation - Aluminium Valley
- 084 Job creation - Gaspésie/Maritime regions
- 085 Investment
- 086 E-business development
- 301 Foreign tax - current year
- 302 Foreign tax - previous year
- 303 Environmental trust
- 304 Designated trust
- 305 Financial tools specialized employees
- Select
Tax-Inc-Add
Additions to net income for tax purposes that are required in order to calculate taxable income should be entered here. They will be shown as positive amounts. If more than one amount is entered, each amount and its description will appear on a supplementary page.
The following options are applicable for the keyword Tax-Inc-Add.
- Losses from an international financial centre
- Losses from a business at Mirabel
- Other addition (specify)
Adjustments for an international financial centre are effective for taxation years ending after May 2, 1991. QTA section 737.17 allows a corporation which operates an IFC to add to its taxable income the amount of losses exceeding the income from IFC operations.
Adjustments for businesses established in the Mirabel foreign trade zone are effective as of March 10, 1999. Approved corporations engaged in international logistics, aircraft maintenance and repair, supplemental vocational training in aviation, and light processing located in a defined area in the vicinity of Mirabel will be entitled to certain tax benefits. These include exemptions from Quebec income tax, capital tax, and health services fund contributions.Enter an addition to Quebec income tax as a positive amount. This amount will be shown on page 3 of the CO-17.
Enter any other additions from net income for tax purposes here. These amounts will be added as other adjustments on the provincial returns.
Tax-Inc-Ded
Deductions from net income for tax purposes that are required in order to calculate taxable income should be entered here. They will be shown as positive amounts. If more than one amount is entered, each amount and its description will appear on a supplementary page.
The following options are applicable for the keyword Tax-Inc-Ded.
- Exploration expenses - Mid-North or Far North
- Income from a foreign trade zone at Mirabel
- Income from a qualified investment fund
- Income from an international financial centre
- Income for forest producers
- Labour-sponsored fund
- Major investment project
- Patronage dividend
- Securities company or securities clearing house
- Shares of prospector & grubstaker
- SME mfg businesses - remote resource regions
- Other deduction (specify)
Adjustments for businesses established in the Mirabel foreign trade zone are effective as of March 10, 1999. Approved corporations engaged in international logistics, aircraft maintenance and repair, supplemental vocational training in aviation, and light processing located in a defined area in the vicinity of Mirabel will be entitled to certain tax benefits. These include exemptions from Quebec income tax, capital tax, and health services fund contributions.Enter a deduction from Quebec income tax as a positive amount. This amount will appear on form CO-1136.
An eligible corporation that incurs start-up expenditures with respect to an eligible investment fund may claim a tax credit equal to 50% of these costs for a taxation year. The maximum credit that may be claimed for the period covered by the credit is $250 000 per fund.
Adjustments for an international financial centre are effective for taxation years ending after May 2, 1991. QTA section 737.14 allows a Quebec corporation operating an IFC in a taxation year to deduct from its taxable income the amount of income exceeding losses from IFC operations.
The deduction for prospector's & grubstaker's shares allowed by Fed ITA 110(1)(d.2) is deducted from net income for tax purposes. This amount is needed on schedule 21 (T2S(21)) to calculate adjusted net income for purposes of the maximum allowable foreign tax credit.
Enter any other deductions from net income for tax purposes. These amounts will be deducted as other adjustments on the provincial return.
Commission-Amt
Use the keyword Commission-Amt to enter the amount of the commissions from sales agencies.
Commission-Rate
Use the keyword Commission-Rate to enter the percentage of commission from the sales agencies.
FixdAssetRec
Enter any differences between the change in fixed assets during this year per books and for tax purposes in the FixdAssetRec keyword. DT Max will then generate schedule 8-Rec (T2S(8)-Rec) (Reconciliation) schedule. This schedule is not for filing purposes but may be useful internally; you can ensure no errors or omissions of changes in fixed assets are in the tax returns to be filed. If you cannot reconcile the schedule, use ExplainDiff to describe the source of the difference, if it is known.
The following options are applicable for the keyword FixdAssetRec.
- Net book value - opening
- Net book value - ending
- Deferred book additions
- Operating leases capitalized (books)
- Deferred capital gain
- Deferred recapture
- Ded. expenses capitalized (books)
- Non dep. expenses capitalized (books)
- Investment tax credits booked
- Pre-valuation day appreciation
- Other (specify)
The opening and ending net book values are needed to determine the change in fixed assets per books.
Book additions of fixed assets which are deferred for tax purposes entered here will be added or deducted from the change in fixed assets for tax purposes. If property acquired in the year is not depreciable for tax purposes due to the available-for-use rule, enter the amount as positive and it will be added to the additions for tax purposes. If a prior year addition is available for use this year, it should be entered as a negative amount here and it will be deducted from the additions for tax purposes.
Operating leases capitalized for book purposes will be added to the change in fixed assets for tax purposes. Where the accounting treatment of a lease is as a capital lease but the same lease is considered to be an operating lease for tax purposes, the capitalized value of the lease on the books must be added back here.
Capital gains deferred for tax purposes will be added to the change in fixed assets for tax purposes. Deferral of the capital gain can arise when a capital gains reserve has been taken on proceeds receivable, when business property has been replaced or on a rollover of property by the corporation where no gain or loss has occurred for tax purposes.
Recaptures deferred for tax purposes will be added to the change in fixed assets for tax purposes. Deferral of the recapture can arise when the replacement property rules are applied.
Deductible items for tax purposes which are capitalized for books purposes will be added to the change in fixed assets for tax purposes.
Non depreciable expenses for tax purposes which are capitalized on the corporation's books will be added to the change in fixed assets for tax purposes. These items are not recognized for tax purposes.
Investment tax credits (ITC's) which are booked for accounting purposes will be deducted from the change in fixed assets for tax purposes. When ITC's have been deducted from fixed assets on the books, enter the amount deducted here. For tax purposes, an adjustment for the ITC's earned is required next year.
Pre-Valuation-day appreciation of property will be deducted from the change in fixed assets for tax purposes. For such property disposed of during the year, this appreciation is excluded from any taxable capital gain on the property although it is reflected in the proceeds of disposition for book purposes; an adjustment to remove this element from the proceeds is, as a result, required.
Enter other items reconciling the change in fixed assets for tax to books. If the amount is to be deducted from the change for tax purposes, enter the amount as negative; if it is an addition, enter as a positive amount.
ExplainDiff
If schedule 8-Rec (T2S(8)-Rec) (Fixed asset reconciliation) is used but cannot be reconciled, use ExplainDiff to describe the source of the difference, if it is known. This will be printed on schedule 8-Rec (T2S(8)-Rec). DT Max will generate this schedule if you use the FixdAssetRec keyword to enter any differences between the change in fixed assets per books and for tax purposes.
OntCMTAdjust
Use OntCMTAdjust if the corporation is subject to Ontario corporate minimum tax. DT Max will calculate the Ontario CMT base on schedule 566.
The following options are applicable for the keyword OntCMTAdjust.
- Dividends deductible per fed. subs. 138(6)
- Equity income (loss) from corporations
- Share of partnership/JV income (loss)
- Share of partnership/JV adj. income (loss)
- Dividends deducted in financial statements
- Patronage div. received & not included in net inc/loss
- Patronage div. paid & not included in net inc/loss
- Fed ITA 85 or 85.1 accounting gain
- Fed ITA 85 or 97 accounting gain
- Fed ITA 87 accounting gain
- Fed ITA 88 accounting gain
- Fed ITA 13(4) & 44 accounting gain
- Allowable interest not otherwise deducted
- Capital gains on eligible donations
- Other - enter adjustment type
Enter dividends received/receivable that are deductible under federal subsection 138(6).
Adjustments to financial statement net income are required if the equity or consolidation methods of accounting have been used. For CMT purposes, these methods are specifically disallowed. As a result, equity income recorded in the financial statements is deducted from net income recorded and equity losses are added back in order to reflect use of the cost method of accounting. Enter equity income as positive and losses as negative.
Enter the corporation's share of partnership(s)' or joint venture(s)' income (loss) to the extent that it is reflected in the corporation's net income from its financial statements. Enter total net income earned as a positive amount and the amount entered will be deducted from net income. Enter total net losses as a negative amount and the amount entered will be added to net income.
Enter the corporation's share of adjusted partnership(s)' or joint venture(s)' income (loss). This is the corporation's share of partnership and joint venture income (loss) which is recalculated on a CMT basis. Enter total adjusted net income earned as a positive amount and the amount entered will be added to net income. Enter total adjusted net losses as a negative amount and the amount entered will be deducted from net income.
Enter dividends that have been deducted to arrive at net income per financial statements. This includes dividends that have been declared and paid after May 5, 1997, pursuant to Ontario subs.57.4(1.1), but excludes dividends under federal subs. 137(4.1).
Tax-deferred book gains on rollovers must be subtracted from financial statement net income for CMT purposes. Enter gains as positive amounts and the amount entered will be deducted from net income. Losses entered as negative amounts will be added to net income. These are amounts which are elected on transfers of property pursuant to sections 57.9 and 57.10 of the Ontario Corporations Tax Act.
Enter interest allowable under para. 20(1)(c) or (d) of the ITA to the extent it has not been deducted otherwise in determining CMT adjusted net income.
Enter capital gains on eligible donations of publicly-listed securites and ecologically sensitive land made after May 1, 2006 to the extent reflected in net income/loss.
Enter adjustments other than the above types here. The amount and description entered will print on schedule 1-CMT (T2S(1)-CMT). Enter additions to financial statement net income as positive amounts and deductions as negative.Extraordinary items recorded in the financial statements are excluded from financial statement net income for Ontario CMT purposes. Enter extraordinary items to be added back to income as positive amounts and items to be deducted as negative amounts.
ABILOV
Use ABILOV to override the allowable business investment loss (ABIL) deducted from net income on schedule 1 (T2S(1)).
DT Max can also calculate the deductible loss and amount to be carried forward. Enter current year dispositions which qualify for an ABIL in the CapitalProp group and choose "YES" in the ABIL-Disp keyword in this group. Use [Alt-J] to enter different values for other jurisdictions.
Sales
This information which is from the corporation's financial statements is requested on page 1 of the Quebec CO-17 return. Use [Alt-J] to enter different values for other jurisdictions.
GrossRevenue
Gross revenues of the corporation for the year is requested on page 1 of the Quebec CO-17 return.
Ontario uses gross revenues to determine whether the corporation is subject to capital tax or must pay a flat amount of capital tax. Use [Alt-J] to enter different values for other jurisdictions.
GrossRev-Bus
Gross revenues of the corporation for the year from all active businesses carried on in Canada is requested on AT1 schedule 11 for the Alberta manufacturing and processing profits deduction.
GrossRev-M&P
Gross revenues of the corporation for the year from manufacturing or processing only is requested on AT1 schedule 11 for the Alberta manufacturing and processing profits deduction.
Assets.al
Use Assets.al to enter the total assets of the corporation as at the current taxation year-end date, as requested on page 1 of the Alberta AT1 return. This amount must be entered to the nearest thousand of dollars.
If the corporation's permanent establishment is in another jurisdiction such as Quebec, Ontario, Manitoba, Saskatchewan or British Columbia where tax on capital exists, the total assets must be entered in the Assets keyword within the TaxOnCapital group.
NetEquity
Net share equity of the corporation as at the year-end date is used for calculation purposes for Quebec only.
Quebec uses total net share equity, according to the immediately preceding taxation year financial statements, to determine which rate is used to calculate the SR&ED salaries & wages tax credit. DT Max will determine this rate based on the information entered here if this is the first year of the corporation; otherwise, enter the immediately preceding taxation year's net share equity in the Equity.his keyword in the CorpHistory group and in Tot-Equity in the RelatedParty group for any associated corporation(s). DT Max will carry forward information entered here next year into the CorpHistory group.
Small businesses qualify for the higher credit rate if in the immediately preceding taxation year, total assets of the corporation and all associated corporations are less than $25 million and net equity of the corporation and all associated corporations is less than $10 million. Use [Alt-J] to enter different values for other jurisdictions.
NonTaxIncQ
Enter the amount of Quebec taxable income here which is not subject to Quebec tax due to a provision in the Quebec Taxation Act. This amount will be deducted from taxable income on the CO-771, calculation of income tax form
Patronage
Use the keyword Patronage to indicate if allocations in proportion to patronage were made to all customers at the same rate, except to allow for different types or classes of goods, products or services, or classes, grades or qualities of these goods, products or services.
The following options are applicable for the keyword Patronage.
- No
- Yes
Patron-Divs
Use the keyword Patron-Divs to enter the details of the patronage dividends paid to both member customers and non memeber customers.
The following options are applicable for the keyword Patron-Divs.
- Member customers of the year
- Member customers of the year (agr. co-op)
- Non-member customers of the year
- Non-member customers of the year (agr. co-op)
- Member customers of a previous year
- Member customers of a previous year (agr. co-op)
- Non-member customers of a previous year
- Non-member customers of a previous year (agr. co-op)
Bus-Trans
Use the keyword Bus-Trans to allocate the total business transacted between member and non member customers, to be used in the part 2 calculation of the patronage dividend deduction.
The following options are applicable for the keyword Bus-Trans.
- Total business with member customers
- Total business with non member customers
Patron-CF
Use the keyword Patron-CF to enter the amount of the balance of undeducted amounts carried forward from a previous year. Use [Alt-J] to enter different values for other jurisdictions.
Patron-Trans
Use the keyword Patron-Trans to enter the total of undeducted amounts transferred on amalgamation or wind-up of a subsidiary.
Patron-ABI
A corporation eligible for the small business deduction must recalculate its patronage dividend deduction to correct its income from an active business carried on in Canada, where that income differs from the corporation's net income for tax purposes determined before taking the patronage dividend deduction into account.
Use the keyword Patron-ABI to specify patronage dividend amounts attributable to active business income whenever these differ from amounts allocated to member and non-member customers.
The following options are applicable for the keyword Patron-ABI.
- Total paid to all customers, attributable to ABI
- Paid in the year to non-members, attributable to ABI
- Undeducted amounts attributable to ABI
S23-AssoCode
Use the keyword S23-AssoCode to indicate the association code.
The following options are applicable for the keyword S23-AssoCode.
- 01 Associated for purposes of the business limit
- 02 CCPC that is a third corporation - s.256(2)
- 03 Non-CCPC that is a third corporation -s.256(2)
- 04 Associated non-CCPC
- 05 Associated CCPC - via third corp - s.256(2)
SmallBusLim
Use SmallBusLim to override this corporation's business limit for purposes of the small business deduction.
DT Max will otherwise calculate the limit based on all information entered, including the RelatedParty groups entered for associated corporations, as $400 000 less the limit(s) allocated to any associated corporation(s). If this corporation's taxation year is less than 51 weeks, DT Max will prorate the limit by the number of days in the year over 365. Use [Alt-J] to enter different values for other jurisdictions.
ThirdParty-Assoc
Use the keyword ThirdParty-Assoc to indicate whether or not the corporation is associated with another corporation in the taxation year solely because of their association with the same third corporation.
The following options are applicable for the keyword ThirdParty-Assoc.
- Yes
- No