Example - Format for Tax Communication Memo PDF

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Shirazi CPA Company

Memorandum To: Mr. Barney Rubble From: Amir Hossein Shirazi CC: Rubble’s Associates

Dear Mr. Barney Rubble, Our team has come to a conclusion that it would be more profitable, if you invest your $150,000 into purchase of preferred shares of Bedrock Inc.

According to our calculations, the investment of full $150,000 in a five-year guaranteed investment certificate would make payments of $2,175 annually. However, after paying $827 tax on this amount, you will get to keep $1,348 of your annual payment. In addition, by Investing $150,000 into a condo as a rental property, if you do not claim CCA (capital cost allowance) on your rental income producing property (the condo), which helps you to save more money in future, you would receive the amount of $1,240 after paying $760 for taxes. On the other hand, Investment of the full $150,000 in the shares of Bedrock Inc. is the most profitable option. This investment will provide $1,394 after paying $606 taxes. However, it is extremely important to make sure to buy preferred shares which 200 KING STREET, TORONTO, ON T 647-123-4567 U WWW.SHIRAZICPA.CA

guarantees an annual dividend payment. If the stocks to be purchased are common shares, then choosing the first option, the investment in a five-year guaranteed certificate, would be the most profitable option.

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