Hrm3704 Assignment 8 With Answers 2023.

What is transfer pricing? Why are transfer price rules important? {Ans: - price you charge among different parts of a corporate group - it is important from a tax standpoint because it impacts how much is taxed where (ex. Canada, US, provinces)}In order to use ITA Section 85, the consideration must include some shares. Why? {Ans: must include some shares because if no shares are included, economic position has changed, it would be arm's length sale as ownership would've changed and assets would've been sold}What is the nature of a transaction under ITA section 86? {Ans: - changing the capital structure of a company - share for share exchange - all of the shares of one class for shares of a new class}Under what conditions are non-residents taxable in Canada? {Ans: - they are taxable in Canada on income earned in Canada}We have suggested that when a taxpayer transfers assets from a sole proprietorship to a corporation, the taxpayer would prefer to maximize the amount of debt receieved as consideration for the assets, and minimize the amount of stock received for the assets. Why does the taxpayer prefer to receive debt rather than stock? {Ans: