Today, I want to talk about the top non-deductible expenses.

Additionally, in 2006 there were non-deductible expenses related to the conversion.

Statements were also made to the effect that under this approach, non-deductible expenses would not generally reduce a corporation's safe income on hand.

This resulted primarily from an increase in non-deductible expenses relating mainly to once-off charges.

Accordingly, the taxable profit consists of the retained profits, non-deductible expenses and the paid dividends.

The lower effective tax rate in the first quarter of 2008 was largely due to first quarter 2007 non-deductible expenses related to the Company's conversion.

Thus, a flat tax proposal is not fully defined unless the proposal includes a differentiation between deductible and non-deductible expenses.

Deductions on formulaic basis for otherwise non-deductible expenses related primarily to export and tourist businesses and the media.

Other non-deductible expenses include the cost of insurance, title and registration, and the recurring cost of renting a boat slip.

Depreciation/capital non-deductible expenses book of revenues and allowances expenditure revenue earning costs lump sum taxation operational costs.

Total deferrals and non-deductible expenses Assistance received or to be received/Equity from Public Funding (EPF)

Adjustments include depreciation differences under MACRS, add-back of most tax exempt income, and deduction of many non-deductible expenses (e.g., 50% of meals and entertainment).

The first quarter 2008 effective tax rate was unfavorably impacted by the absence of a research and development tax credit, a decrease in tax-exempt investment income and a relative increase in non-deductible expenses.

The increase for the fourth quarter and full year tax rate was the result of a decrease in the ratio of pre-tax earnings to non-deductible expenses and a shift in earnings mix among states.

The increase in the tax rate was due largely to the non-deductible nature of the impairments recorded in the quarter and an increase in the ratio of non-deductible expenses to estimated pre-tax income.

The higher effective tax rate for the first quarter of 2013 was caused by non-deductible expenses and the effect of operating losses from loss-making subsidiaries, for which full valuation allowances were made on their deferred tax assets.

In This Issue Safe Income Calculation – Treatment of Non-Deductible Expenses The Income Tax Technical News is produced by the Legislative Policy and Regulatory Affairs Branch.

Other than the impact from non-deductible expenses, the high effective tax rate in the third quarter of 2011 was partially due to the valuation allowance made on deferred tax assets arising from the tax loss carryforwards of the loss-making subsidiaries.

The Canada Revenue Agency (CRA) investigation showed that, for the 2002 and 2003 tax years, Constructions Gerpro K.D. inc., a construction company specializing in foundations, claimed $115,000 of non-deductible expenses on its income tax returns.

In paragraph 84 of his decision in Kruco, Dussault J. indicated that elements such as non-deductible expenses "reflect cash flow shown on the balance sheet which in no way affects the calculation of income for the purposes of the Act."

The CRA investigation determined that Duncan deliberately entered numerous fictitious and non-deductible expenses in Larose's business records, including home appliance purchases, trailer park rental fees, interest charges on personal credit cards, veterinary expenses, vacations, and grocery purchases.

The primary drivers for the difference between the Company's effective tax rate and the statutory tax rates were permanent differences from non-deductible expenses, employment tax credits, change in state valuation allowances, certain international operations, taxes related to minority interests, and qualified stock option expenses that are not deductible.