2016 Checklist for Corporations & Shareholders Year End Taxes As the calendar year-end approaches, taxpayers have a few more weeks to organize their financial affairs. All financial transactions affecting the 2016 tax year will have a December 31, 2016 cutoff, with the exception of the RRSP contributions, which allow for an extra 60 days after year-end for contributions that will count towards the 2016 tax year. Every Canadian has the opportunity to do some year-end tax planning, but ... Read More
Should rental properties be held personally or in a corporation?With the real estate in such high demand in Vancouver, Canada, many Vancouverites are buying investment properties either to generate rental income and/or participate in capital appreciation. The dilemma commonly faced is whether or not the rental unit(s) should be held personally or in a corporation?
Personal ownership makes more senseAlthough there are many pros, cons and legal considerations that come with ... Read More
Determining the Need for Outside Controllership ServicesYour company’s business cycle likely tends to fluctuate according to seasonal demand, industry/supply chain dynamics, economic conditions, or a host of other variables, and your accounting department likely feels the strain of these cycles when they’re at their peak. Are you aware of the signs and symptoms that may indicate your business could use outside controllership services?
10 signs you could benefit from outside ... Read More
Utilizing Outside Controllership & CFO Advisory ServicesAccounting departments in successful businesses are always bursting at the seams with special projects, audit preparations, financial statement preparations for bank financing, cash flowing projections, etc. The top people responsible for financial reporting and the financial management of an organization are typically the controller and/or the CFO. These professionals are responsible for the finance staff, routine finance ... Read More
When to IncorporateWe recently published a blog post on small business corporate tax rates in British Columbia heading downwards to 11.5% on the first $500,000 by 2019. This reflects a 15% reduction in taxes from the current 13.5%. Considering that taxes are a big-ticket expense item for businesses, a 15% reduction is a huge discount. However, upcoming corporate tax rate reductions are only advantageous to businesses that can leverage them. Successful proprietors are often burdened ... Read More
Small business corporate tax rates in BC heading downwardsSeveral changes to tax legislation announced in the 2015 Canadian federal budget were recently granted Royal Assent. A measure that is highly relevant for small businesses in BC going forward is the gradual decrease in the combined federal and provincial corporate tax rates over the next 4 years, which are as follows: 13.5 % - present rate 13.0 % - effective January 1, 2016 12.5 % - effective January 1, 2017 12.0 % - ... Read More
BC Realtors are currently having a banner year. Record prices and record sales equate to record income for realtors. Prior to 2009, realtors were forbidden to earn their income in the form of a corporation, which means they were barred from any tax saving opportunities available to Canadian controlled private corporations (CCPCs).
PREC: The Personal Real Estate Corporation, Corporate Tax Structure for BC RealtorsSince 2009, the Real Estate Council of British Columbia (RECBC) has ... Read More
Income Splitting Using a Family Trust As discussed and referenced in previous blog posts, a successful corporation with surplus retained earnings can reap large tax-saving benefits from income splitting when done with spouse and children. When the owner/shareholder of a business wishes to take advantage of income splitting opportunities as his children reach adult age, the easiest and most economical way to accomplish this is by restructuring the existing share classes and holdings. Ideally, ... Read More
The 13.5% Corporate Tax Rate I have discussed or referenced in many corporate tax planning blogs that the biggest benefit to being an incorporated Canadian business is that the first $500,000 in corporate profits is taxed at a low 13.5% corporate tax rate. Professionals and their net profits from an incorporate practice also benefit from this corporate tax rate.
Tax Planning Problem for Professional PartnershipsHowever, many professionals work in a partnership business structure where ... Read More
Income Splitting Pre Planning We are now firmly into the 2015 calendar year and with the New Year come new tax laws aimed at reducing your family’s tax burden (eg. recently announced family tax cuts) and changes to existing tax laws that reduce old benefits (eg. higher personal taxes on ineligible dividends).