Entrepreneurship & Small Business

Question on filling out T2 Short Return and Schedule 141

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  • Apr 19th, 2021 6:15 pm
[OP]
Newbie
Mar 2, 2021
7 posts
5 upvotes

Question on filling out T2 Short Return and Schedule 141

I'm completing a T2 Short Return based on the recommendation of some of the smart folks here. It's my first year and fiscal year end is Feb 28, 2021. I made 0 revenue and have a net income loss of $4000. I've filled out schedule 100 and 125, but I'm stuck on a few lines of schedule 141 and T2 Short Return form.

1. Schedule 141. In part 4, line 110 asks me:

If you have a professional designation and are not the accountant associated with the financial statements in Part 1 above, choose one of the following options:
1) Prepared the tax return (financial statements prepared by client)
2) Prepared the tax return and the financial information contained therein (financial statements have not been prepared)


Huh? Which one do I select? I didn't hire anyone to do my financials and am doing it by myself. And what are they referring to when they say "financial statements" have not be prepared? I made my income statement, balance sheet, revenue and expenses breakdown. Why would it say that they have not been prepared?

Line 200 asks "In any of the following assets, was an amount recognized in net income or other comprehensive income (OCI) as a result of an impairment loss in the tax year, a reversal of an impairment loss recognized in a previous tax year, or a change in fair value during the tax year?" This is going over my head and I don't know if the answer should be yes or no.

2. T2 Short Return, Line 204 asks "Is the corporation claiming as type of loss?" Does my net income loss count? Or do they mean some other losses? Because if it does count, I'd have to complete another schedule 4, which is a 6 page document and much longer than the T2 Short Return. So, it makes me wonder if they mean some other sort of "loss".

Thank you for your help.
2 replies
Member
Jan 18, 2017
342 posts
251 upvotes
1. You don't have a professional designation. So you don't fill this part out.

2. You don't fill this part out either.

3. You're not "claiming" a loss for purposes of the tax return. This is a specific term, meaning that you're applying a prior year loss against current year income. You aren't doing this, so no Sch 4.

totalanonymitee wrote: I'm completing a T2 Short Return based on the recommendation of some of the smart folks here. It's my first year and fiscal year end is Feb 28, 2021. I made 0 revenue and have a net income loss of $4000. I've filled out schedule 100 and 125, but I'm stuck on a few lines of schedule 141 and T2 Short Return form.

1. Schedule 141. In part 4, line 110 asks me:

If you have a professional designation and are not the accountant associated with the financial statements in Part 1 above, choose one of the following options:
1) Prepared the tax return (financial statements prepared by client)
2) Prepared the tax return and the financial information contained therein (financial statements have not been prepared)


Huh? Which one do I select? I didn't hire anyone to do my financials and am doing it by myself. And what are they referring to when they say "financial statements" have not be prepared? I made my income statement, balance sheet, revenue and expenses breakdown. Why would it say that they have not been prepared?

Line 200 asks "In any of the following assets, was an amount recognized in net income or other comprehensive income (OCI) as a result of an impairment loss in the tax year, a reversal of an impairment loss recognized in a previous tax year, or a change in fair value during the tax year?" This is going over my head and I don't know if the answer should be yes or no.

2. T2 Short Return, Line 204 asks "Is the corporation claiming as type of loss?" Does my net income loss count? Or do they mean some other losses? Because if it does count, I'd have to complete another schedule 4, which is a 6 page document and much longer than the T2 Short Return. So, it makes me wonder if they mean some other sort of "loss".

Thank you for your help.
______
Canadian & US tax guy (CPA)

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