Question

1) The maximum CPP Contributory Earnings for this year is $59,200

The maximum CPP annual basic exemption for this year is $3,500

A)True

B)False

2)  For HST purposes, if you sell Exempt products you cannot collect HST and have the right to claim ITC on purchases related to zero rated revenue.

A) True

B)False

3)

In the province of Ontario, this year, with regards to "Employee vs Contractor",, which of the following is correct?

	A	Contractors, have vacation and severance rights , but must pay CRA Payroll Deductions on each pay cheque.   Contractors can deduct expenses related to working at a company and do not need tp pay CRA Payroll Deductions on each pay.
	B	An employees has vacation and severance rights , but must pay CRA Payroll Deductions on each pay cheque. Contractors cannot deduct expenses related to working at a company and do not need tp pay CRA Payroll Deductions on each pay., but has to pay EI on his income tax return.
	C	Contractors can deduct expenses related to working at a company and do not need tp pay CRA Payroll Deductions on each pay. An employees cannot hire an assistant, but do have vacation and severance rights , and must pay CRA Payroll Deductions on each pay cheque.
	D	An employees has vacation and severance rights , but must pay CRA Payroll Deductions on each pay cheque.   Contractors cannot deduct expenses related to working at a company and do not need tp pay CRA Payroll Deductions on each pay.

Answer 1

Answer1

False(b)

Reason

Year	Maximum CPP contributory earnings	Basic exemption amount
2020	$58,700	$3,500
2019	$57,400	$3,500
2018	$55,900	$3,500
2017	$55,300	$3,500

Answer 2

(A )True

Reason

For zero-rated goods and services, you don't charge or collect GST/HST, but you can still claim ITCs for them on your GST/HST return.

For exempt goods and services, you also do not charge or collect GST/HST and you cannot claim Input Tax Credits

Answer3

(B)

An employees has vacation and severance rights , but must pay CRA Payroll Deductions on each pay cheque. Contractors cannot deduct expenses related to working at a company and do not need tp pay CRA Payroll Deductions on each pay., but has to pay EI on his income tax return.