Question

In the current year E attended university full time and received a scholarship of $2,000 that covered most of her tuition. She also received support payments of $45,000 from her former spouse of which $15,000 was designated as support for her 5 year-old child. E withdrew $8,000 from her RRSP to help cover university expenses. Fortunately she won $5,000 from a lottery. What amount is added to E’s income for tax purposes in the current year?

Answer 1

	taxable	Non taxable
Item	Amount	Amount	Description
Scholarship	0	2000	Scholarship received as full time degree student and paid for tution expenses is non taxable
Support Payment	30000	15000	Child support is tax free for receipent and not deductible for payor, and alimony received as revenue receipt is fully taxable but capital receipt in form of single sum is tax free, here it is assumed its revenue received, since no information given for same.
Withdrawal from RRSP	0	8000	withdrawal from RRSP and paid for education expense which is returned back in 10 years is not taxable income.
Lottery winning	5000	0	Amount from lottery winning is fully taxable at higher income tax slab.
Total	35000	25000
So $35,000 is included in income for tax purposes and 25000 is not a taxable amount.