What if the land is sold for cad 500,000

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Reference no: EM133327656

Case 1

A piece of land is purchased for CAD 1,000,000 at the beginning of a project and is sold 10 years later at the end of the project for CAD 4,000,000. The tax rate is 35% and the capital gain inclusion rate is 50%. Inflation is negligible.

What if the land is sold for CAD 500,000?

Case 2

A building is purchased for CAD 500,000 at the beginning of a project and is sold four years later at the end of the project for CAD 600,000. The asset is in a pool with a CCA rate of 10%. The half-year rule applies. The tax rate is 35% and the capital gain inclusion rate is 50%. Inflation is negligible.

	Year 1	Year 2	Year 3	Year 4	Year 5
UCC	CAD 500,000	CAD 475,000	CAD 427,500	CAD 384,750	CAD 346,275
CCA	CAD 25,000	CAD 47,500	CAD 42,750	CAD 38,475

What if the building is sold for CAD 100,000?

Case 3

A piece of equipment is purchased for CAD 500,000 at the beginning of a project and is sold five years later at the end of the project for CAD 50,000. The asset is in a pool with a CCA rate of 30%. The half-year rule applies. The equipment is one of many assets in the pool. The RRR is 10.0%. The tax rate is 35% and the capital gain inclusion rate is 50%. Inflation is negligible.

	Year 1	Year 2	Year 3	Year 4	Year 5	Year 6
UCC	CAD 500,000	CAD 425,000	CAD 297,500	CAD 208,250	CAD 145,775	CAD 102,042
CCA	CAD 75,000	CAD 127,500	CAD 89,250	CAD 62,475	CAD 43,733

What if the equipment is sold for CAD 120,000?

What if the equipment is sold for CAD 600,000?

Reference no: EM133327656

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