Simard Ltd., a CCPC, had no GRIP balance at its year end on December 31, 2018. During 2019, the Company received eligible dividends of $37,000 and designated $23,000 of its dividends paid as eligible. At the end of 2019, Simard has a GRIP of $37,000.
For 2020, Simard has Taxable Income of $476,000. This amount includes taxable capital gains of $14,000, interest income on long-term bonds of $7,000, and a net capital loss deduction of $14,000. In addition, the Company receives eligible dividends during the year of $17,000. In determining 2020 Tax Payable, the Company has a small business deduction of $76,000. During 2020, Simard Ltd. pays dividends of $25,000, with $18,000 of this amount being designated as eligible.
Determine the Company's GRIP balance at the end of 2020.

Question

Quizplus · Accepted Answer

The Answer of Simard Ltd., a CCPC, had no GRIP balance at its year end on December 31, 2018. During 2019, the Company received eligible dividends of $37,000 and designated $23,000 of its dividends paid as eligible. At the end of 2019, Simard has a GRIP of $37,000.
For 2020, Simard has Taxable Income of $476,000. This amount includes taxable capital gains of $14,000, interest income on long-term bonds of $7,000, and a net capital loss deduction of $14,000. In addition, the Company receives eligible dividends during the year of $17,000. In determining 2020 Tax Payable, the Company has a small business deduction of $76,000. During 2020, Simard Ltd. pays dividends of $25,000, with $18,000 of this amount being designated as eligible.
Determine the Company's GRIP balance at the end of 2020.