For business owners in British Columbia, the trend of remunerating shareholders with dividends instead of salaries and/or management bonuses has been going on for years. The low corporate tax rate of 13.5% on the first $500,000 of corporate profits in conjunction with total CPP premiums of $4,712 on the first $51,100 of salary paid to each shareholder/manager created a strong tax planning argument to take dividends instead of salary. Currently, with discussion in Ottawa to further expand the ... Read More
Tax Tips for Vancouver Female Small Business Owners – Creating a Strong Brand is Vital to Success
I am a Chartered Accountant at Mew & Company - I have had my own accounting firm located in Downtown Vancouver for almost 15 years now. I was recently inspired by a conversation I had with a new client which I want to share with all the women business owners in Vancouver, BC. My new client is an energetic and enterprising entrepreneur. Her business has been expanding in a very challenging industry. Without being prompted by me, her reasoning for the continual expansion was to successfully ... Read More
Vancouver Tax Considerations for Buying a Business in British Columbia
If you are in the initial stage of negotiating the purchase of an incorporated business in British Columbia (B.C.), this is a good time to consider the method you choose to go about the acquisition. There are two methods to acquire a business: you either buy the desired assets of the company, or you buy the shares of the company. Each method has different business tax consequences for the seller and the purchaser, so knowledge of the different tax treatments can provide the purchaser with room ... Read More
Vancouver Corporate Reorganization and Tax Planning
Corporate reorganization involving the exchange of shares is a very powerful and versatile tax planning tool. The simplest and most common corporate reorganization method involves the shareholder of a corporation exchanging all of his/her shares in one class of existing shares, for shares of another authorized class. The primary focus of the share exchange is the “freezing” of the current fair market value of the shares given up by the shareholder, who is referred to as the "transferor". In ... Read More
To Incorporate or Not, Vancouver?
Many small business owners are aware of the considerable tax benefits afforded to incorporated businesses in terms of very low corporate tax rates, but incorporating too early is a common tax planning blunder these days. Of course, there are many legal considerations to incorporating a business such as limiting liabilities. Even then, it is a legal debate whether incorporation will protect certain professionals from damages suffered due to professional negligence. This blog post is about the ... Read More
