Byrd & Chen's Canadian Tax Principles, 2025-2026, 1st edition
Published by Pearson Canada (August 27, 2025) © 2026
  • Gary Donell
  • Clarence Byrd
  • Ida Chen

Title overview

For courses in taxation.

Consistent with the title of this textbook, our objective is to instill a solid understanding of the basics of income tax and GST/HST through an appreciation of the tax principles, concepts, and unique vocabulary that make up the framework upon which the Canadian tax system has been built. This level of understanding is not solely directed at a theoretical or academic level; considerable emphasis is placed on practical everyday situations in preparation for careers where an understanding of tax in some form will be helpful at a minimum and essential at best.

The textbook will provide you with the elementary tools necessary to develop an awareness to help identify, analyze, and apply the tax law to a wide range of subjects ranging from determining the income tax liability or refund of individuals earning employment income, carrying on a business, earning investment income, identifying potential income tax benefits directed at students, investing in Tax-Free Savings Accounts (TFSAs), and understanding how the income tax law applies to corporations, trusts, and partnerships.

Hallmark features of this title

  • Self-Study Problems (SSPs). These problems are more complex than the Exercises and include a number of comprehensive problems. We have marked the points within chapters where you should stop and complete each SSP. The SSPs are available on MyLab for download, in the “Chapter Resources” tab, and you’ll find the solutions in your Study Guide.
  • Tax Software Assignment Problems dealing with personal tax returns are found at the end of Chapters 4 and 11. An additional Tax Software Assignment Problem, involving a corporate tax return, is located at the end of Chapter 14. Solutions to Tax Software Assignment Problems are available to instructors only. Look for updates on MyLab in the new year, as these will be updated to reflect the tax year. 
  • Comprehensive Assignment Problems. These are the most challenging type of problem material in the text. They are cumulative in that they incorporate issues from previous chapters. There are two comprehensive APs per chapter in Chapters 6 through 11, found at the end of the APs in the chapter. Solutions to these problems are available to instructors only.

New to this Edition

In this edition we have endeavoured to continue the process of modifying existing content to present facts and situations that are both practical and that students are likely to encounter in the course of their careers. In addition, and in recognition that income tax continues to evolve on an ongoing basis, we have added new content to address topics that are both relevant and current, including changes to legislation that often affect federal annual budgets and federal annual economic fiscal updates, plus other federal legislation designed to address myriad issues, most often to close tax loopholes or to override decisions of the courts that the federal government views as unacceptable. Finally, one of our objectives is to provide educators with material that explains the changes between each edition to facilitate the annual transition. The following specific additional features are included with this 2025–2026 edition:

  • NEW! Quick Review Questions. Each chapter now ends with 10 multiple-choice questions that highlight the most important topics. The questions are designed to be answered in just a few minutes each and provide students with a means of immediately verifying that they have understood the content within each chapter. Answers are available to instructors.
  • NEW! Expanded ITA/ITR Reference Lists. In recent years, the Chartered Professional Accountants of Canada (CPA Canada) have begun to place greater emphasis on the awareness of specific provisions of the ITA and ITR and the ability to navigate the legislation. In step with this change, we have expanded the reference lists (which formerly only listed the general provisions) to include every specific provision discussed in each chapter. This will allow educators, students, and others to quickly identify a specific ITA or ITR provision and where it can be found in the textbook. This list is found at the end of each chapter and is available to download on MyLab.

Key features

Important Digital Assets in MyLab Accounting

  • Data Analytics Project - In the Data Analytics Project, you will analyze a comprehensive data set and make a series of accounting decisions. This assignment is designed to prepare you for the data analytics competencies that have been included in the most recent CPA Competency Map. You will use Excel-based tools to assess data for accuracy, then organize and filter large quantities of information to make the data appropriate for income tax calculations. You will then incorporate income tax concepts, including the calculation of net income, taxable income, and tax payable using the outputs of your data analysis in Excel. This assignment also includes data visualization and incorporates tax planning concepts for a business. This is assignable from your instructor on MyLab. 
  • CPA Competency Alignment Map - This downloadable file ties the chapters to the CPA Competency Map. Students can use this mapping to understand the level of depth required for each broad topic area that is covered in taxation at the Entry, Core, or Elective course levels. Practice Examinations A 90-minute practice examination, along with a solution and suggested marking guide, is available for each of the chapters in MyLab. These examinations contain a variety of problems, including multiple choice, true/false, essay questions, and longer problems. The goal of Practice Examinations is to allow you to evaluate your ability to write the examinations in your tax course. To get the maximum benefit, you should write it under examination conditions, within a 90-minute time constraint. 
  • Self Study Problems. Self Study Problems are available on MyLab, with solutions in your Study Guide. In the textbook, we have marked the point within the text that you should work each Self Study Problem. 
  • This MyLab will include the student files that have always been made available, including tax returns, practice examinations, PowerPoint presentations, updates, self-study problems, and more. In addition, students can access valuable assessments and study tools to help students practise and understand key concepts from the text. Students can practice an expanded number of questions based on chapter content, watch videos highlighting core topics from the text, review key terms with glossary flashcards, and work on additional comprehensive assignments throughout the resource.
  • Freehand Grader (beta) is the grading technology in MyLab® and Mastering® that creates an authentic assessment experience for both instructors and students. Freehand Grader, available as a new assignment type, allows you to quickly grade any kind of handwritten assignment. As you grade, you indicate the grading criteria and build the rubric question by question. This grade-as-you- go approach lets you add notes to provide students with individual feedback. Students upload their handwritten solutions, including all the steps that went into their responses. Their work provides insight into their thought processes, showing what they know, not just a final answer.

Table of contents

Volume I

  1. 1 Introduction to Federal Taxation in Canada
  2. 2 Procedures and Administration
  3. 3 Income or Loss from an Office or Employment
  4. 4 Taxable Income and Tax Payable for Inliiduals
  5. 5 Capital Cost Allowance
  6. 6 Income or Loss from a Business
  7. 7 Income from Property
  8. 8 Capital Gains and Capital Losses
  9. 9 Other Income, Other Deductions, and Other Issues
  10. 10 Retirement Savings and Other Special Income Arrangements

Volume II

  1. 11 Taxable Income and Tax Payable for Inliiduals Revisited
  2. 12 Taxable Income and Tax Payable for Corporations
  3. 13 Taxation of Corporate Investment Income
  4. 14 Other Issues in Corporate Taxation
  5. 15 Corporate Taxation and Management Decisions
  6. 16 Rollovers under Section 85
  7. 17 Other Rollovers and Sale of an Incorporated Business
  8. 18 Partnerships
  9. 19 Trusts and Estate Planning
  10. 20 International Issues in Taxation
  11. 21 GST/HST

Author bios

Gary Donell

I began working with the C.A. firm of Thorne Riddell in Montreal in the early 1980s. A few years later I made the move to Ottawa to begin my career with Revenue Canada, now the CRA. I spent 30 years at the CRA, retiring in 2015. In my early years with the CRA I was an income tax auditor and was anxious to move on to other pursuits within the CRA, of which there were many. In preparation I read every income tax-related publication and textbook I could get my hands on, including legal books on statutory interpretation and the transcripts of every income tax court decision. While vacation and beach goers were reading the latest New York Times bestseller I was reading from the latest tax conference report and tax journals.

Eventually it all paid off when an opportunity arose to teach introductory income tax to CRA auditors in the late 1980s. I jumped on the opportunity and taught for a couple of years before applying for a job with the Income Tax Rulings Directorate of the CRA in Ottawa. The Rulings Directorate is responsible for income tax interpretations and, at the time, technically reviewing every form, publication, and tax guide published. I spent 10 years at Rulings and learned a lot, but the teaching and education bug wouldn’t let go of me after all those years. I returned to the training and education division of the CRA halfway through my career, where I spent the next 15 years teaching thousands of CRA auditors and writing a dozen or so courses on a wide range of income tax topics from an introductory to advanced level.

Shortly after retiring from the CRA I went to work as a consultant with Welch LLP in Ottawa where I spent the next five years dealing with practical, everyday client issues, which was very rewarding thanks to then tax partner, Don Scott, and the many amazing people I had a chance to work with. I participated in in-house training and was involved in the writing of the annual CPA income tax update course, which Welch had been writing for many years. I also spent those same years teaching a dozen or so advanced tax courses for CPA Ontario.

To come full circle, my journey with Clarence Byrd and Ida Chen began in the early 1990s while working for CRA Rulings. I had just picked up the latest edition of the textbook (the 1991–1992 version, I believe) and had contacted them after finding a few errors. Clarence reached out, and the rest is history. I acted as the technical consultant for Clarence for the next 28 years. Today I sit back thinking to myself that I have been indirectly preparing for this lead author role the better part of my life. I have amassed private sector experience working with accounting firms, CRA insider experience, course writing experience, and 20 years of teaching experience on top of it all. This wealth of different experience gives me a unique perspective that has allowed me to shape introductory income tax education. Income tax is ripe for the picking these days as opportunities abound both within the CRA and in the private sector. Unfortunately, many students choose to stay clear of income tax, believing it too difficult a subject. I can attest to the fact that the basic concepts and principles are not all that difficult to understand when properly and gradually presented. You will find that income tax is not only interesting but enlightening in terms of just about every aspect of Canadian life. Armed with a solid understanding of income tax principles you may find yourself joining the ranks of tax specialists one day, but in the meantime this textbook will provide you with a solid foundation that you can build on should you so choose.

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