Financial Literacy 30 | Unit 5 | Lesson 7
Assignment 5.7 Filing Income Tax
Using Wealthsimple Tax digital tax filing software, generate a PDF of a tax return for the
fictional individual described below. When completing the tax return, write your own last
name in the Last Name text box.
Scenario
Meet Trevor.
•
•
Born on November 13, 2006.
Social Insurance Number is 100 000
009.
•
He lives in a rental apartment in a rural
community with a roommate at 456
Main Street City, SK S9H 4H6.
•
•
Email: trevor99@gmail.com
Telephone: 306-789-0000
Trevor had a job with Graco Designs for four months of the previous year from January to April
and received a T4 for this income to file with his taxes.
In May, he started a landscape and snow removal business called Green Thumb Enterprises and
worked with this company for the remaining 8 months of the year. This business provides
comprehensive lawn care and snow removal services to residential and commercial clients. The
services offered include mowing, edging, trimming, fertilizing, weed control, leaf removal, snow
plowing, and snow shoveling.
He worked hard for 8 months and made enough income to pay all his bills and expenses. He
also hired one helper for the 8 months and now he needs to file his income tax for his business.
His revenues and expenses are listed below to be used to file income tax.
He is self-employed and runs the business as a sole proprietorship (not incorporated). As a sole
proprietorship, all the company’s income is considered his personal income in addition to his
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Financial Literacy 30 | Unit 5 | Lesson 7
wages. He doesn’t get a T4 from Green Thumb Enterprises like he did from Graco Designs as
he will claim all the income and expenses on his tax return.
Additional Information:
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•
•
•
•
He is single, with no children. He did not have any medical expenses or donations.
He does not have a NETFILE Access Code and has not filed his taxes before this year.
He is a Canadian resident, has always lived in Saskatchewan and is not Indigenous.
He was not in prison, and he did not open a First Home Savings Account (FHSA).
For his company, use the Industry Code is 561730 (Landscaping Services) in the tax
return.
Special Notes to Consider:
To file this income tax for the self-employed portion of his income, Trevor needs to provide
copies of all of the invoices he gave to his customers and receipts for all his expenses that he
paid. For this assignment, those invoices and receipts are not included but would be needed if
this were a real situation.
Obtaining a GST number and filing GST (and possibly PST) are part of owning a business,
separate from income tax. Collecting and not remitting GST and PST to the government is a
federal tax offense. All businesses are recommended to follow current tax regulations. This is not
demonstrated in this assignment but is an important part of your financial obligations as an
entrepreneur.
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Financial Literacy 30 | Unit 5 | Lesson 7
Trevor’s T4
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Financial Literacy 30 | Unit 5 | Lesson 7
Income Statement Information for Green Thumb Enterprises
Company Name - Green Thumb Enterprises
Income Statement - For Year Ended Dec 31, 20--
REVENUE
Sales (over 8 months) $60/hour * 20 hours/week * 4 weeks/month * 8
months/year
$
38,400.00
$
38,400.00
$
$
$
2,000.00
400.00
3,616.00
$
$
$
$
$
$
$
$
6,400.00
800.00
800.00
1,200.00
9,600.00
6,800.00
800.00
32,416.00
NET INCOME
$
5,984.
Business-use-of-home expenses
Total area or number of rooms in the home
Total area or number of rooms in the workspace
$
$
1,000.00
100.00
$
$
$
600.00
1,200.00
1,500.00
TOTAL REVENUE
OPERATING EXPENSES
(Fixed costs)
Fixed Costs:
Insurance
Business tax,fees,licenses, dues, etc
Interest: Equipment Lease
Variable Costs:
Supplies: Gasoline: 8 tanks per month @ $100/tank
Supplies: Oil
Supplies: Various shop supplies used
Telephone: Cell Phone
Direct Employee Wages: $15/hour for 20 hours/wk x 4 weeks a month
Rent Apartment / Home Office $850 per month
Advertising
TOTAL OPERATING EXPENSES
Heat
Electricity
Insurance
Motor vehicle expenses
How would you like to report your motor vehicle expenses?
Make & model
Km you drove
total km to earn business
Fuel and oil
Insurance
Maintenance and repairs
No CCA claim for this year (as it's the first year)
4
I'll need to calculate them
2015 Dodge Ram
$
$
$
40000 kms
25000 kms
5,000.00
2,000.00
2,000.00