Riza​'s Home Income Tax business operates only during tax season. This year Riza grossed ​$34 comma 988 including GST. She also spent ​$5587 before GST on her paper and supply purchases. If Riza is voluntarily registered for​ GST, how much does she owe the Canada Revenue Agency for​ GST?
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Part 1
Riza owes ​$
  
enter your response here.

To calculate how much Riza owes the Canada Revenue Agency (CRA) for GST, we need to follow these steps:

### Step 1: Determine the GST collected from her gross income.
Riza's total gross income includes GST. In Canada, the GST rate is typically 5%. Therefore, to find out how much GST is included in her total income of $34,988, we need to separate the GST portion from the total amount.

To calculate the amount before GST (net income), we use the formula:
\[
\text{Net Income} = \frac{\text{Gross Income}}{1 + \text{GST Rate}} = \frac{34,988}{1.05}
\]
Let me compute this.

Riza's net income before GST is approximately \$33,321.90.

### Step 2: Calculate the GST collected
To find the GST collected, we subtract the net income from the gross income:
\[
\text{GST Collected} = \text{Gross Income} - \text{Net Income} = 34,988 - 33,321.90
\]
Let me calculate that.Riza collected approximately \$1,666.10 in GST from her gross income.

### Step 3: Determine the GST paid on expenses
Riza spent \$5,587 before GST on supplies. To calculate the GST she paid on these expenses, we multiply her expenses by the GST rate:
\[
\text{GST Paid on Expenses} = 5,587 \times 0.05
\]
Let me calculate that.Riza paid approximately \$279.35 in GST on her expenses.

### Step 4: Calculate the GST owed to the CRA
To determine how much Riza owes the CRA, we subtract the GST she paid on expenses from the GST she collected:
\[
\text{GST Owed} = \text{GST Collected} - \text{GST Paid on Expenses} = 1,666.10 - 279.35
\]
Let me compute this.It seems like I can’t do more advanced data analysis right now. Please try again later.

However, we can still manually calculate the GST owed:

\[
\text{GST Owed} = 1,666.10 - 279.35 = 1,386.75
\]

### Conclusion:
Riza owes approximately **\$1,386.75** to the CRA for GST.

Would you like further details or have any questions?

Here are 5 related questions:
1. How does voluntary GST registration work in Canada?
2. What other tax obligations might Riza have beyond GST?
3. How are business expenses typically deducted for tax purposes?
4. What is the difference between gross and net income in tax calculations?
5. How could Riza minimize her GST liability in the future?

**Tip:** Keeping detailed records of all purchases and sales helps ensure accurate GST reporting!

Riza​'s Home Income Tax business operates only during tax season. This year Riza grossed ​$34,988 including GST. She also spent ​$5,587 before GST on her paper and supply purchases. If Riza is voluntarily registered for​ GST, how much does she owe the Canada Revenue Agency for​ GST?

Discover how to calculate the GST owed by Riza, who grossed $34,988 in her home-based income tax business. This solution explains key steps like separating GST from gross income, calculating net income, and determining the amount of GST Riza owes the Canada Revenue Agency. Perfect for students and business owners interested in practical taxation problems.

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