Tax Equalization Benefit Sample Clauses
Tax Equalization Benefit. (1) During the transition period, the Executive’s liability to income tax on the Base Salary, the Bonus and the Reimbursement (the “Cash Compensation”) will be computed to be equivalent to the US Federal and California income tax that the Executive would pay on the same Cash Compensation, were he to reside and work only in California. Any taxes due on Cash Compensation in excess of this liability will be funded by the Company. A tax equalization calculation will be performed after the completion of Executive's United States and Canadian income tax returns for the tax years ending December 31, 2018 and December 31, 2019, to reconcile taxes paid and ensure any underpayment or overpayment of taxes is settled between the Executive and the Company on completion of the calculation.
(2) Executive will be responsible for the timely filing of income tax returns in the United States and Canada and for global taxes on Executive’s personal income.
Tax Equalization Benefit. With respect to the tax years ending December 31, 2014 and 2015, respectively (the “Two Tax Years”), during which the Executive receives a Base Salary and any payment pursuant to the Bonus Plan (together, the “Compensation”), the Company agrees to tax equalize the Executive as set out below.
(1) Under the tax equalization scheme, the Company will determine or cause to be determined, for each of the Two Tax Years:
(a) the total tax paid or payable by the Executive in respect of the Compensation:
(i) in Canada, including federal and provincial income taxes but excluding employment insurance or Canada Pension Plan remittances, and taking into account any foreign and other tax credits, deductions or other reduction of taxes, charges or payments, whether available under the laws of Canada or any income tax convention or other bilateral or multilateral agreement to which Canada and the United States are then signatories and which the Executive could have claimed in respect of the Compensation; and
(ii) in the State of California, including state, local and federal income taxes, and taking into account any foreign and other tax credits, deductions or other reduction of taxes, charges or payments, whether available under the laws of the United States, the State of California or any income tax convention or other bilateral or multilateral agreement to which Canada and the United States are then signatories and which the Executive could have claimed in respect of the Compensation (the “Combined Tax Calculation”); and
(b) the total tax that would have been paid or payable by the Executive in the State of California in respect of the Compensation, had the Executive been employed exclusively and the Compensation been earned entirely in the State of California (the “California Tax Calculation”).
(2) To the extent that the amount resulting from the Combined Tax Calculation exceeds the amount resulting from the California Tax Calculation, the Company will pay the Executive an amount (the “Tax Equalization Amount”):
(a) which, in the first of the Two Tax Years, is required to allow the Executive to receive, on an after-tax basis, 100% of the difference between the Combined Tax Calculation and the California Tax Calculation; and
(b) which, in the second of the Two Tax Years, is required to allow the Executive to receive, on an after-tax basis, 70% of the of the difference between the Combined Tax Calculation and the California Tax Calculation.
(3) For greater certainty:
(a)...