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Waterloo Centre for Taxaton in a Global EconomySchool of Accountng and Finance University of Waterloo
ANNUALREPORTFY 2014-2015
TABLE OF CONTENTSDirector’s report….........................................................................................................................................................1 Overview of the centre.................................................................................................................................................2 Strategy Map....................................................................................................................................................................3 Research
Creating Tax Research..............................................................................................................................................4 Tax research published............................................................................................................................................4 Illustrative Working papers....................................................................................................................................5 Awards.........................................................................................................................................................................5Tax research presented...........................................................................................................................................5 Other tax research presentations..........................................................................................................................6 PhD Program..............................................................................................................................................................6 Alliances......................................................................................................................................................................7
Disseminating Tax Research ................................................................................................................................8 Tax Policy Research Symposium...........................................................................................................................8 Canadian Tax Professionals Research Roundtable........................................................................................................9 Newsletters..............................................................................................................................................................10 Articles......................................................................................................................................................................10 Outreach...................................................................................................................................................................10
Education SAF Students/Programs.......................................................................................................................................11
Young Tax Professionals.......................................................................................................................................11 uWaterloo Tax Program........................................................................................................................................11 MAcc Program.........................................................................................................................................................12 MTax Program.........................................................................................................................................................12 Teaching & Learning Projects..............................................................................................................................13
Sponsors/Tax Community...................................................................................................................................14 Tax Educator Conference.....................................................................................................................................14 Newsletter...............................................................................................................................................................14 Tax Education Roundtable...................................................................................................................................14
Financial Reporting Results for 2014/15...............................................................................................................................................15
Stakeholders Sponsors....................................................................................................................................................................16 Tax Faculty...............................................................................................................................................................16
Appendices Appendix A – Tax Courses Offered at UWaterloo........................................................................................17
Undergraduate......................................................................................................................................................17 Master of Accounting...........................................................................................................................................18 Master of Taxation................................................................................................................................................18
Appendix B – Young Tax Professionals...........................................................................................................21 Contact Information...................................................................................................................................................22
DIRECTOR’S REPORT
It is with great pleasure that I report on the activities of the Centre for its first year of operations.
We are extremely grateful to our sponsors for supporting the Centre in so many ways. They have provided excellent advice as we have undertaken our initiatives, they have engaged in our events and they have provided the financial support needed to carry on our activities.
This year marked the launch of our Tax Policy Research Symposium under the Centre but with the same sponsor, Deloitte, who has championed this event since 2004. The Symposium continues to fill the gap between the tax research community and Canadian tax policy makers. Further, it provides the only regular opportunity for Canadian tax researchers from accounting, economics and law to interact both formally and informally.
The Centre has gained international attention in the research community through co-hosting the Taxation in a Global Economy Symposium with The University of Texas at Austin. This conference stimulated research on issues related to base erosion and profit shifting. Plans have begun for a second symposium in Waterloo in 2016.
Our students represent a significant channel through which our tax knowledge is spread. Launching the Young Tax Professionals student group within the School raises the profile of taxation as a career. The group is also an eager audience with whom we explore developments in taxation.
As the Centre enters its second year, we continue to seek opportunities to reach out to policy makers and other tax professionals. For example, current plans include a web-published interview with the Tax Foundation (U.S.), a paper with the C.D. Howe Institute, and visits to Ottawa. We look forward to the opportunities that lay ahead.
Ken KlassenDirectorMay 22, 2015
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OVERVIEW OF THE CENTREThe Waterloo Centre for Taxation in a Global Economy, officially launched on May 1, 2014, has eight supporters: CPA Canada, Canadian Tax Foundation, Deloitte, EY, International Fiscal Association Canadian Branch, KPMG, PricewaterhouseCoopers, and Rogers Communication.
The Centre’s research mandate is to enhance tax thought. The Centre supports researchers as they explore critical tax issues and inform tax professionals, including those engaged directly in tax policy. The Centre also aggregates and disseminates academic research, and links Canadian tax researchers with global counterparts through academic partnerships. To achieve these goals, the Centre hosts annual tax policy symposia, facilitates biennial multinational tax research symposia, and develops a variety of channels to disseminate academic research.
The Centre’s education mandate is to develop the knowledge and skills needed by young tax professionals entering the marketplace, implement the best practices to help students learn, and build a national reputation for tax pedagogy. To achieve these goals, the Centre identifies the knowledge and skills needed by new tax professionals, supports the development of course content, and inspires and supports students who are interested in a tax career.
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STRATEGY MAP
To help us focus on those activities that will help us achieve our purpose and vision, and to provide value to our stakeholders, we developed a strategy map. This annual report is structured based on our priorities and initiatives and how they provide stakeholder value and contribute to our vision.
Purpose We are a Centre where our faculty contribute insights into key issues in the field of taxation
We are a Centre where our students gain the competencies they need to excel in a career in taxation
Vision By 2017 we want to be a recognized Centre for taxation research and education in Canada and internationally
Stakeholder Value
Students
“The Centre supports our tax
learning community”
Tax Faculty
“The Centre supports our outstanding
research environment”
School/University
“The Centre makes a
significant contribution to
our reputation.”
Sponsors
“The Centre makes a
difference in Canadian tax policy and tax
education”
Tax Community
“The Centre is a major
contributor of insights into key
issues in taxation and is a priority source
of young tax professionals”
2015-16 Priorities
Education Research
SAF Students/Faculty
Sponsors/Tax Community
Create Disseminate
2015/16 Initiatives
Young Tax Professionals
Tax Educator Conference
Publish Tax Research
Tax Policy Research Symposium
uWaterloo Tax Program
Tax Education Roundtable
Present Tax Research
Tax Professional Research
Roundtable
Teaching & Learning Projects
Newsletter Support PhD Program
Reach out to government and
other bodies
Develop alliances with other tax researchers
Newsletter
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RESEARCH
CREATING TAX RESEARCH
Tax research published
“The Role of Auditors, Non-Auditors, and Internal Tax Departments in Corporate Tax Aggressiveness.” K. Klassen (University of Waterloo), P. Lisowsky (University of Illinois), and D. Mescall (University of Saskatchewan). The Accounting Review (forthcoming).
Using the external preparer signatory to U.S. corporate tax returns, this paper demonstrates that tax returns prepared by company staff and by non-auditor external firms claim more aggressive tax positions than returns prepared by the company’s auditors. Big 4 firms are particularly linked to less tax aggressiveness when they are the company’s auditor.
“A Model of Multinational Income Shifting and an Application to Tax Planning withE-Commerce.” K. Klassen (University of Waterloo), S. Laplante (University of Wisconsin), and C. Carnaghan (University of Lethbridge). The Journal of the American Taxation Association (2014) 36(2): 27-53.
Cross-jurisdictional income shifting and the reinvestment-repatriation decision are incorporated into a model of international investment. In doing so, we find that investment characteristics affect both repatriation and income shifting. Consistent with the model’s predictions, e-commerce is related to income shifting in manufacturing firms only when repatriations are less likely.
“Income Splitting and Anti-Avoidance Legislation: Evidence from the Canadian ‘Kiddie Tax.’” A. M. Bauer (University of Illinois), A. Macnaughton (University of Waterloo), and A. Sen (University of Waterloo). International Tax and Public Finance (forthcoming).
We examine whether “kiddie tax” legislation in Canada, effective in 2000, deters income splitting between parents and minor children. The data shows that taxing dividend income at the top tax rate decreased dividends reported by children by 86%. Concurrently, the share of capital gains (not subject to the kiddie tax until 2011) reported by minor children increased. The decrease in dividend income is much larger than the increase in capital gains income. Hence, our analysis suggests that the “kiddie tax” is an effective method to deter income splitting.
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Strategy
Creatng tax research iscentral to our visionand creates signifcantstakeholder value. TheCentre supports theSchool’s outstandingresearch environmentand helps build theSchool’s reputaton asthe leading centre fortaxaton research inCanada andinternatonally.Leading researchcreates knowledge thatadds value for our PhDstudents, our faculty,the School, oursponsors and thebroader taxcommunity.
RESEARCH
Illustratve Working papers
“The Influence of Corporate Social Responsibility on Lobbying Effectiveness: Evidence from Effective Tax Rates.” J. Garcia (University of Waterloo).
Do the reputational effects of corporate social responsibility lead to increased effectiveness of corporate lobbying expenditures? Using archival data, this paper finds that firms that are more socially responsible get a higher return on their lobbying expenditures than firms that are less socially responsible, reflected in lower effective tax rates. The financial benefits that can be gained from being socially responsible may result in bottom-line profits to the shareholders, while still addressing the needs and desires of non-owner stakeholders.
“Unprofitable Affiliates and Income Shifting Behavior.” L. De Simone (Stanford University), K. Klassen (University of Waterloo), and J. Seidman (University of Texas at Austin).
While shifting income from high tax jurisdictions to low tax jurisdictions has been widely discussed and documented, we focus on the potential shifting from profitable to unprofitable affiliates. Our evidence shows that firms exploit the temporary low-tax nature of loss affiliates, taking into consideration the expected ability to carry losses back or forward within the affiliate.
Awards Best paper award, Haskell & White Corporate Reporting & Governance Conference,
“Blending Theory and Practice”, Irvine, CA, September 2014 for the paper:“Shareholder Activism and Political Spending.” V. Baloria (Boston College), K. Klassen, and C. Wiedman (University of Waterloo). Working Paper.
Tax research presented“Targets’ Tax Shelter Participation And Takeover Premiums.” T. Chow (Singapore
Management University), K. Klassen (University of Waterloo) and Y. Liu (Singapore Management University).
Presented at the Contemporary Accounting Research Conference, October 17–18, 2014, Halifax
“Unprofitable Affiliates and Income Shifting Behavior.” L. De Simone, K. Klassen, and J. Seidman (affiliations noted above).
Presented at the Taxation in a Global Economy Symposium, Sept. 25–26, 2014, Austin.
“Anticipated Tax Planning as a Source of Merger Gains.” T. Chow, K. Klassen, and Y. Liu (affiliations noted above).
Presented at the Nineth Annual Bauer Accounting Research Symposium, March 27–28, 2015, Houston.
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RESEARCHOther tax research presentatonsK. Klassen participated in the following: a panel, “International Tax Planning: Canada and the OECD’s Base Erosion and
Profit Shifting Project.” Centre for Taxation in a Global Economy, June 19–20, 2014, Toronto;
an editors’ panel, Contemporary Accounting Research Conference Doctoral/Junior Faculty Consortium, October 16, 2014, Halifax; and
an editors’ panel, The American Taxation Association Doctoral Consortium, February 26, 2015, Washington
PhD Program There are currently two doctoral students interested in taxation.
Khin Phyo Hlaing is developing her dissertation. Her interests involve the intersection of executive compensation arrangements, tax incentives and financial reporting effects.
Karen Pinto is working through courses as she develops as a young scholar. She has been very effective as a research assistant supporting the research activities of the Centre.
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RESEARCHAlliances
University of Texas at Austin The Centre has a strategic alliance with the tax faculty at the McCombs School of Business. These include
Lillian Mills, Department Chair, and Wilton E. and Catherine A. Thomas Professor in AccountingJohn Robinson, C. Aubrey Smith Professor in AccountingJeri Seidman, Assistant ProfessorThree tax-focused PhD students
The objective of the Centre’s alliances is to expand the network of tax research in support of the Centre’s objectives. During 2014-2015, the alliance involved ongoing interaction of Centre researchers with researchers in Austin, plus a jointly-hosted research conference:
Taxation in a Global Economy Symposium, Understanding Base Erosion and Profit Shifting. September 25–26, 2014, Austin, Texas.
To provide research relevant to the G-20 and OECD efforts to curb aggressive international tax planning, the symposium called for papers on this topic. We received 24 papers and selected 6 for presentation at the conference. Papers included both analytic and archival methods and authors and participants were from the U.S., Canada, and Germany.
Attendance at the conference was approximately 70 and while predominantly accounting tax researchers, it also included 15 PhD students, law faculty and several tax professionals. The lunch keynote speaker was Manal Corwin, KPMG’s National Service Leader for International Tax and formerly the Deputy Assistant Secretary of Tax Policy for International Affairs in the Treasury Department.
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RESEARCH
DISSEMINATING TAX RESEARCH
Tax Policy Research Symposium On June 19 and 20, 2014, the Waterloo Centre for Taxation in a Global Economy held the 11th annual Tax Policy Research Symposium in downtown Toronto. The 2014 Symposium continued the tradition of exclusive sponsorship by Deloitte. The conference was free to participants.
Invitees were mostly university tax faculty from accounting, law, and economics, but also included current PhD students, representatives from the Centre’s sponsors, and officials from the Department of Finance, the Canada Revenue Agency and the Ontario Ministry of Finance. A total of 35 faculty members from 15 universities and about 20 people from the other groups attended.
Faculty usually attend conferences in their own discipline. Our cross-disciplinary tax s y m p o s i u m p r o v i d e s a r a r e opportunity to share their differing perspectives on current tax issues. The Symposium also encourages participants to network across disciplines and with practice and government participants.
The first afternoon was devoted to a panel discussion of a current tax policy issue, the OECD’s Base Erosion and Profit Shifting (BEPS) project. The panel, in part, responded to the Federal Government’s request for input that appeared in the 2014 Budget.
Overall, there was lively engagement on the topic of the OECD’s project. While there are helpful findings from research thus far, further work is needed to inform the policy debate in Canada and more broadly.
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Strategy
While creatng taxresearch is central toour vision, thedisseminaton of thatresearch is alsoimportant to createstakeholder value. Asthe leading centre fortaxaton research inCanada and recognizedinternatonally weengage ourstakeholders outsidethe academiccommunity for abroader exchange ofideas.
PanelistsDhammika Dharmapala, University of Illinois at
Urbana-Champaign, reviewed the economicsand accountng research on income shifing. Heconcluded that the magnitude of income shifingis as large as ofen believed.
Albert Baker, Deloite, identfed the key issues inthe BEPS arena and summarized a global surveyof tax executves. The survey revealedinterestng diferences in perspectve emergeacross regions. For example, almost allNetherlands and France respondents areconcerned about increased public atenton totax, yet less than two-thirds in Germany are asconcerned, and North Americans are inbetween.
Art Cockfeld, Queens University, provided legalinsight and contended that BEPS is a new efortthat has a long history with few real successes.He ofered a number of country-by-countrysolutons that have arisen in spite of signifcantinternatonal legal impediments to the efort.
Ken Klassen, University of Waterloo, commentedon BEPS by summarizing cross-natonal mergersand acquisitons research. The researchsuggests, among other conclusions, that Canadamay not want to be at the forefront of BEPSenforcement initatves.
RESEARCH
On the second day, five academic research papers were presented, followed by commentaries from two discussants, one from academe and one from Deloitte. Tom Crowe, Charles Taylor, Muris Dujsic, Jay Niederhoffer and Christy MacDonald from Deloitte provided excellent comments on the ideas presented.
In addition, Larry Chapman spoke about developments at the Canadian Tax Fou nda t ion , with spe c ia l reference to the possible certification of tax practitioners.
Canadian Tax Professionals Research Roundtable October 6, 2014 – Toronto
The eight sponsors were invited to a Research Roundtable for two hours in Toronto. Beyond an update of the Centre’s activities, the main agenda item was to summarize the six papers presented at the joint Waterloo-Texas research symposium. Prof. Klassen summarized each of the papers emphasizing key findings and their relevance to the current policy debate on base erosion and profit shifting, and to current practice. The format encouraged discussion amongst the attendees, rather than a one-directional presentation format. Attendance included 15 professionals with all eight sponsors represented. The discussion was lively and the desire for discussion exceeded the allotted time.
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�Speakers Lindsay Tedds, University of Victoria, presented
her work on user fees that cites charge toofset the costs of providing specifc publicservices.
Andrew Bauer, University of Illinois at Urbana-Champaign, reported on a statstcal model thatestmates tax risk by predictng unfavourablesetlement with tax authorites.
Wei Cui, University of Britsh Columbia, examinedthe practce of numerous countries to taxforeigners on gains realized on transfers ofinterest in foreign enttes—partcularlyinvestments in real estate.
Michael Wolfson, University of Otawa, addressedthe fact that existng measures of incomeinequality do not take into account incomeearned through CCPCs.
Ben Alarie, University of Toronto, reported on astatstcal model that predicts the outcome ofcourt decisions in tax disputes usingcharacteristcs of the case and of the judge.
RESEARCH
NewsletersIn our first newsletter we reported on a paper on “A model of multinational income shifting and an application to tax planning with e-commerce”. In the second newsletter we reported on the Tax Policy Research Symposium.
ArtclesJ. Li (Osgoode Hall Law School) and A. Macnaughton (University of Waterloo) 2014. “Current Tax Reading” Canadian Tax Journal 62(3), 907-926. J. Li (Osgoode Hall Law School) and A. Macnaughton (University of Waterloo) 2014. “Current Tax Reading” Canadian Tax Journal 62(1), 301-316.
OutreachInitial steps were undertaking in the first year of the Centre to reach a broader audience within Canadian tax policy and practice. These include initial work on a paper for the C.D. Howe Institute. Further steps on this objective are planned for 2015-2016.
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EDUCATION
SAF STUDENTS/PROGRAMS
Young Tax Professionals The School of Accounting and Finance has over 250 students per year in our BAFM, Math/CPA and Biotech/CPA programs who will complete three tax courses as part of their undergraduate degree. In May 2014 we asked students who had an interest in a career in tax and were in their second tax course, to apply to be part of our Young Tax Professionals (YTP) team. Twenty of those applicants were selected. In the fall, we invited an additional twenty of our fourth-year students to be part of this team.
Our objective is to offer very good students who are interested in a career in taxation the opportunity to closely interact with faculty, alumni and other full-time tax professionals to gain a deeper understanding of career options, develop some key skills needed for tax practice, and learn about current issues and specialty areas within the field. We also want to encourage employers to view our YTP program as the place to come for their tax recruiting needs.
In the fall we had speakers from PwC, Sandvine and CPA Canada address our students. Alan Macnaughton spoke to the group about tax research and we had a social evening where faculty and students enjoyed unhealthy food together. In the winter we have had speakers from Gowlings and Deloitte and Jim Barnett presented our plans for redesigning our undergraduate tax program for their input.
Three of our YTP students spoke to the School’s Advisory Council about their experiences in this program and were very well received.
This activity has been an excellent way for us to know our students better, for them to know us, and for them to see a larger world of opportunities in a tax career.
uWaterloo Tax ProgramUndergraduate Program
We have redesigned our three (refer to Appendix A for details) undergraduate tax program to have a strong emphasis on what the students will be able to do (output) instead of the topics we cover (input). Students will be encouraged to adopt a deeper approach to learning, rather than to see tax as a collection of rules to memorize. The goal is to develop their judgement skills, allowing them to see how all the pieces fit together, and to develop and apply contextually relevant solutions to complex problems.
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Strategy
Developing anoutstanding taxprogram is central toour vision. Suchprograms help ourstudents gain thecompetencies,professionalism andpractcal experiencethey need to excel intheir tax career and itbuilds our reputatonas the leading centerfor taxaton educatonin Canada andrecognizedinternatonally.
EDUCATIONMAcc ProgramWe offer four tax courses in our Master of Accounting program. The first one, Tax Issues Integration, is our equivalent of the CPA tax elective in the CPA Professional Education Program. The other three courses, Tax for the CFO, International Tax, and Tax Policy are electives. In the 2015 class there was significant interest in these courses with 209 students in Tax Issues Integration, 50 in Tax for the CFO, 25 in International Tax and 12 in Tax Policy.
MTax Program In 2014 we admitted 43 new students into the Master of Taxation program. The students who graduated in 2014 all had jobs with 85% working for accounting firms.
In the 2015 winter work term all of the students had jobs with 50% working for accounting firms, 25% at the CRA and 25% in industry.
We sent two new graduates to the Canadian Tax Foundation National Conference in B.C. in December 2014. Steven Hsu and Erik Dimakarakos, were the first recipients of the CTF Conference Award.
We have been located at the CPA Ontario offices for the past 18 years but with their need for more space we are relocating. Our new home will be at the Eaton Centre beginning in the fall 2015 term. It’s a nice central location allowing us to remain in the downtown core. For the summer 2015 term, we’ll be in temporary premises that connect to the Eaton Centre.
Ken Klassen will offer a new course, Accounting for Income Taxes, in the fall 2015 term.
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�MTax Courses
Taxaton and Finance
Tax Research and Statutory Interpretaton
Tax Policy
Integraton of Tax/Audit/Accountng
Taxaton of Corporatons
Introducton to Business Structuring
Business Structuring
Internatonal Tax I
Tax Planning for the Owner-Manager and Executve
Tax Risk Management
Estate & Retrement Planning
Internatonal Tax II
Research Paper
Practtoner FacultyGreg Boehmer and Mat McInnis (EY)Eric Lockwood and Maria Lopez (PWC) Hugh Chasmar, Andrew Oldham, Bruce McCarley and
Christy MacDonald (Deloite) Ruth Cummings and Steve Barichello (KPMG).
MAcc Tax Courses
Tax Issues IntegratonTax for the CFOInternatonal TaxTax Policy
EDUCATION
Teaching & Learning ProjectsAfter many years of teaching tax to undergraduates, we have determined that key concepts in tax can be challenging for many students to grasp and may result in poor performance. These “bottlenecks” can prevent them from learning subsequent topics that build on it. As a result, many take a surface approach to learning – memorizing the basics to meet the requirements of our tax courses – rather than developing the deeper understanding needed to become competent tax professionals who can respond to the complex and evolving needs of clients.
Jim Barnett along with Julie Timmermans, from the Centre for Teaching Excellence, worked on a project to identify and decode some of the bottlenecks that hold students back in the learning process.
First we identified topics in our undergraduate tax program that students found challenging (bottlenecks). Students rated a list of forty potential bottlenecks in terms of their perceived level of importance and their perceived level of understanding. The topics that were rated as the most important and least understood were:
1. Being able to identify tax issues in a non-directed fact situation
2. Being able to read and understand the Income Tax Act
3. Recognizing and understanding the implications of an acquisition of control.
We then worked with tax faculty and tax practitioners to “decode” these bottlenecks and construct a series of steps that experts in the field would use to address these issues. By following these steps, students will be able to develop their skills faster and more completely than if they are left to figure out these steps on their own. We will be using the decoding of “identifying tax issues” in our our third undergraduate tax course in the fall 2015 term.
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EDUCATION
SPONSORS/TAX COMMUNITYTax Educator ConferenceOn May 16, 2014, at the Centre for International Governance Innovation, twenty tax faculty from twelve Ontario universities discussed how we, as academics, prepare our students for both their career and for the CFE so they can be successful at both.
In the morning Maria Loschiavo from CPA Ontario provided an update on the CPA Professional Education Program (PEP) including the yet to be offered tax elective.
In the afternoon Cynthia McIntyre from Ernst & Young, Betty Ann Jarrett from PwC and Stuart Cottrell from Deloitte lead a discussion on the knowledge and skills employers are looking for in our graduates when hiring for a tax or non-tax function.
A special thanks to Cynthia McIntyre and Ernst & Young for sponsoring the lunch at this event.
NewsleterIn the first Centre newsletter we reported on the Tax Educator Conference and in the second newsletter we introduced our Young Tax Professional program.
Tax Educaton RoundtableThe concept behind this roundtable is based on the Canadian Tax Professionals Roundtable described in the Research section. We want to engage those individuals in our sponsor organizations who are responsible for tax education in a discussion on the theory and practice of tax education or the study and practice of how best to teach tax in a university or professional setting.
This initiative did not get implemented this year but we hope to move it forward in 2015/2016.
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Strategy
While creatngoutstanding taxcourses and programsis central to our vision,the disseminaton ofthe teaching andlearning strategybehind these programsis also important tocreatng signifcantstakeholder value. Ifwe are to be known asthe leading center fortaxaton educaton inCanada and recognizedinternatonally weneed to engagestakeholders outsideour university todemonstrate the valueto them of leadingpedagogy.
FINANCIAL REPORTING
RESULTS FOR 2014/15 Our April 30, 2015 fiscal year is not typical as it is the start-up year of the Centre. While many of the activities undertaken will be consistent with future years we did not incur a normal year of expenses.
The graph shows the relationship among the various expense categories and provides an overview of the types of expenses incurred.
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STAKEHOLDERS
SPONSORS
Tax FacultyJim Barnett FCPA, FCA
Joanna Garcia PhD, CPA
Ken Klassen MAcc, PhD, FCPA, FCA
Deb Kraft MTax, TEP
Alan Macnaughton PhD
Julie Robson CPA, CA, CPA (Illinois)
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APPENDIX A – TAX COURSES OFFERED AT UWATERLOO
UndergraduateAccounting and Financial Management (AFM) Program
2A Term
In their 2A term students have the option of taking a six-week segment designed to prepare them for a work term in personal tax preparation.
3A Term – Taxation 1
The theme of their first tax course is “type of taxpayer + type of income = tax treatment”.
Students will develop their understanding of the various sources of income and the components of taxable income and tax payable for individuals and corporations. The topics are covered at a high level to give them a broad perspective on the tax system and an understanding of the importance of the types of income and taxpayer in the determination of tax payable.
3B Term – Taxation 2
The theme of their second tax course is “integration across topics”.
Students will study the same topics as their first full-term tax course but both in more detail and across topics. For example, when discussing employment and business income, students will address both the tests for determining whether an individual is an employee or a self-employed contractor as well as consider the impact on the taxable income and deductions available to both individuals and corporations receiving this type of income.
4B Term – Taxation 3
The theme of their third tax course is “Assess, Analyze, Advise”.
Students will explore tax planning opportunities available to the owner manager including compensation, business structuring and estate planning.
Students will develop their ability to identify issues as well as their ability to plan out the analysis that needs to be done. Students will also expand their knowledge and skills beyond the technical tax rules to analyzing, evaluating and creating tax planning ideas.
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APPENDIX A – TAX COURSES OFFERED AT UWATERLOO
Master of AccountngTax Issues Integration
This course is designed to expand the students’ ability to integrate by building on the Taxation 3 course. It is relevant to students interested in developing tax issue identification skills and understanding the interrelationship of tax and related issues in practical settings. The course is a CPA elective course relevant to students and preparing for CPA exams.
International Tax in a Canadian Context
This course is designed to provide students with a foundation in the basics of international tax law in Canada. The course is of interest to students interested in a specialization in taxation and relevant to students who will not specialize in tax but want to understand the tax implications of international transactions.
Tax Policy & Working with the CRA
The study of the tax policy goals behind the rules provides students with an understanding of the purpose behind each rule. Students will analyze current tax law and propose alternatives which will better meet tax policy goals. Tax policy goals include fairness across similarly-situated taxpayers, redistributing income from rich to poor, avoiding interference with business and personal decisions, and avoiding excessive record-keeping.
Tax for the CFO
This course is designed to provide students with a foundation of tax concepts that will be relevant to industry practitioners. It is most relevant to students interested in developing an understanding of tax reporting, risk management and related accounting issues and will be useful to both students who will and those who will not specialize in taxation.
Master of TaxatonIntroductory Tax and Accounting for MTax
This course is designed to provide the student with the fundamentals of Canadian income taxation and the accounting needed to begin work in the tax field. It will cover both personal and corporate taxation with assigned cases used to demonstrate how the tax system actually works. It will also cover balance sheet and income statement accounting topics related to tax practice. The course will be held in August each year.
Taxation and Finance
This course focuses on the valuation of business interests in the context of the Income Tax Act. Particular attention is given to business valuation matters that arise in circumstances that involve income tax planning assignments.
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APPENDIX A – TAX COURSES OFFERED AT UWATERLOOTax Research and Statutory Interpretation
This course covers two of the most fundamental skills of a tax practitioner: statutory interpretation and the understanding and application of case law. Students will learn the basic structure of the Income Tax Act and related legislation, gain familiarity with the various tools for interpreting and applying the legislation (e.g., defined terms, deeming rules, general rules of statutory interpretation etc.) and understand the various external sources for guidance and their relevance (e.g., CCRA opinions, cases etc.). Students also learn how to read cases, to determine what legal principles and precedents a case established, and to apply case law to particular fact situations.
Tax Policy
This course investigates the Canadian tax system in light of the objectives of that system. For any current tax rule, the idea is to identify the underlying policy problem the rule is intended to solve, consider alternative solutions, and then determine if the current tax rule can be improved or to identify tax planning opportunities.
Integration of Tax/Audit/Accounting
This course integrates tax and accounting issues into cases for discussion in class. The material provides the student with an approach to both prepare and interpret the income tax liability and expense on financial statements in accordance with Canadian generally accepted accounting principles. The determination of 'current' and 'future' income taxes is also reviewed.
Taxation of Corporations
This course concentrates on issues related to the taxation of corporations. This course is taught by integrating a variety of tax issues into cases for discussion.
Introduction to Business Structuring
This course introduces students to the more advanced areas of taxation including corporate reorganizations, partnerships and trusts.
Business Structuring
The Business Structuring course is intended to provide students with an overview, from a tax and business perspective, of a variety of corporate structures that may be used to carry on business. The course examines how these structures differ from one another and how businesses may be reorganized with existing corporate groups and within the context of purchase and sale transactions. The course also deals with related debt and equity financing and capital restructuring issues. Focus is placed on the use of the numerous reorganization provisions contained in the Income Tax Act. This is in order to facilitate the completion of transactions designed to meet the stakeholders' objectives in a tax efficient manner while taking into account an analysis of the business and tax risks associated with the structure.
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APPENDIX A – TAX COURSES OFFERED AT UWATERLOOInternational Tax I
Barriers to cross border trade and investment continue to come down. At the same time, technology has enabled business organizations to access markets that were previously out of reach and to develop new business models that improve the profitability of their operations. The business operations for companies of all sizes are increasingly global. International tax plays a significant role in shaping the manner in which multi-national enterprises organize and finance their operations.
Tax Planning for the Owner-Manager and Executive
Owner-Managers usually have dynamic tax circumstances which demand that the tax advisor adapt their thinking quickly and effectively to bring significant value to their businesses.
Tax Risk Management
This course investigates tax and related accounting issues found in the tax provision on the financial statements to deepen the understanding of the impact of tax on accounting. It will also address the identification, measurement and reporting of tax risk. Corporate governance issued involved in the tax provision will overlay this course.
Estate & Retirement Planning
This course integrates the tax, legal, family and business issues involved in planning for the estate and retirement of the business owner, the professional and the executive.
International Tax II
International Tax II builds on the fundamental principles taught in International Tax I. The course examines in more detail the foreign affiliate and foreign accrual property income rules and practices that apply to Canadian companies seeking to establish, expand, structure and finance their foreign operations in a tax efficient manner. The course also examines how Canadian companies can make effective use of low-tax jurisdictions in international tax planning to own and to finance foreign operations. Finally, the course explores how domestic and international developments and rules, such as transfer pricing, might impact such planning currently and in the future.
Research Paper
There are two aspects to this course. First, this is the major research paper course, which requires students to design and conduct original research on a specific tax issue. Second, the classes address current and emerging tax policy and practice initiatives which practitioners need to recognize to properly advise their clients. They also cover tax and economic issues which might be addressed only tangentially in other courses.
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APPENDIX B – YOUNG TAX PROFESSIONALSThe following are the members of our Young Tax Professional team at April 30, 2015
Dean Ah Sen
Rabani Bakshi
Mike Blake
Carl Cao
Vincent Chan
Min Che
Kenneth Cheung
Archana Chittella
Jeanette Cyr
Fei He (Fifi) Fang
Lin Gan
Connie Ge
Renee Grondin
Alice Guo
Richard Huynh
Danish Khan
Koren Leung
Kate Li
Crystal Li
Alice Liu
Ambrose Liu
Frankie Loreto
Wei Lu
Jagseer Natt
Harsh Oza
Emma Qi
Nancy Song
Shawn Song
Giselle de Sousa
Louise Sui
Ankiet Varmani
Carmen Wai
Robbie Wang
Sharry Wang
Fahad Waseem
Carmen Wong
Shirley Wong
Lynn Wu
Lucy Yao
Jason Yi
Shuai Yuan
Catherine Zhang
Rudder Zhang
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CONTACT INFORMATION
Ken KlassenDirector
Jim BarnettAssociate Director
P: 519-888-4567, ext. 38550
P: 519-888-4567, ext. 35143
Centre Information
T: 519-888-4567 ext. 36536
F: 519-888-7562
www.uwaterloo.ca/saf/wlootax
Photography: Light Imaging & SAF
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