Tax Planning Services & Preparation

Tax planning is about making intentional financial decisions so you keep more of what your business earns — fully within the law. It is not about aggressive tactics or loopholes; it is about understanding the rules and using them wisely.

For Canadian businesses, effective tax planning can:

• Reduce total tax paid over time;
• Improve cash flow and working capital;
• Support reinvestment and expansion;
• Create long‑term financial stability;
• Reduce risk of CRA disputes.

Tax is often one of a business’s largest expenses. Yet many owners only think about it at filing time, when most planning opportunities are already gone. Proactive planning — ideally throughout the year — allows you to time income, expenses, compensation, and investments strategically.

For higher‑income and high‑net‑worth business owners, tax planning also connects closely with personal wealth planning, investment strategy, and estate goals. A coordinated plan ensures business success translates into lasting personal wealth.

Ultimately, good tax planning provides clarity and control. You know what to expect, avoid surprises, and make decisions from a position of strength rather than reaction.

Corporate tax rates in Canada depend on several factors, including whether your company is a Canadian‑Controlled Private Corporation (CCPC), your province, and the type of income you earn.

While specific rates matter, what matters more is ensuring your structure allows access to the most favourable rates available to you, within the framework of federal and provincial tax law. Many business owners focus on headline rates but overlook how planning affects which rate actually applies.

For example, qualifying for the Small Business Deduction can significantly reduce tax on active business income. Losing access to it can increase taxes more than expected. Similarly, investment income inside a corporation is taxed differently than operating income.

For affluent owners and growing businesses, rate management becomes part of a broader strategy that includes reinvestment planning, holding companies, and compensation design.

Rather than chasing rates, sophisticated planning focuses on overall tax efficiency across years and entities. This is where professional guidance adds measurable value.

The Small Business Deduction (SBD) is one of the most valuable tools available to CCPCs. It allows eligible corporations to pay a reduced tax rate on their first $500,000 of active business income.

To qualify and maintain access:

• The corporation must remain a CCPC;
• Taxable capital must stay below certain thresholds:
  • SBD begins grinding down at $10M taxable capital;
  • Eliminated at $50M;
• Passive investment income must be monitored;
• Income must be active business income.

For growing or high‑profit businesses, it is surprisingly easy to grind down or lose access to the SBD without realizing it. Passive income inside the company is a common trigger.

For higher‑net‑worth owners building investment portfolios inside their corporations, careful coordination is essential. Structuring investments, using holding companies, or planning distributions can preserve eligibility.

The SBD is not just a tax break — it is a strategic advantage. Protecting it should be part of any serious corporate tax plan.

Passive income — such as interest, dividends, and rental income — is taxed differently from active business income. It generally faces higher corporate tax rates and can reduce access to the Small Business Deduction.

Once passive income exceeds certain thresholds, the SBD begins to shrink. For profitable corporations with significant retained earnings balance, this becomes a real concern. SBD reduction = $5 for every $1 of passive income over $50K; eliminated at $150K passive income.

High‑net‑worth owners often accumulate investments inside corporations for asset protection and deferral benefits, depending on structure. However, without planning, passive income can quietly erode tax advantages.

Strategies may include:

• Using holding companies;
• Paying dividends strategically;
• Corporate reorganizations;
• Investment structuring.

The goal is balance: growing wealth while preserving tax efficiency. Done correctly, corporate structures can still be powerful wealth‑building tools.

Choosing between salary and dividends is a strategic decision, not just a tax calculation.

Salary can:

• Create RRSP room;
• Support CPP participation;
• Provide predictable income;
• Reduce corporate profits;
• EI exemption for owner-managers.

Dividends can:

• Avoid payroll deductions;
• Offer flexibility;
• Support investment planning;
• Be efficient at higher income levels;
• efficiency varies by province and integration is not always perfect.

High‑income owners often benefit from blending both. The optimal mix depends on retirement goals, lifestyle needs, investment plans, and estate considerations.

For wealthier clients, compensation planning also integrates with family income planning, trusts, and long‑term wealth transfer goals.

A thoughtful compensation strategy aligns tax efficiency with personal financial objectives — not just this year, but long term.

Canada uses a progressive tax system where higher income is taxed at higher marginal rates. Rates vary by province, and top combined rates exceed 50% in many jurisdictions.

Rather than focusing on rates alone, sophisticated planning focuses on managing *when* and *how* income is recognized.

Planning techniques may involve:

• Income smoothing across years;
• Dividend timing;
• RRSP and TFSA strategies;
• Capital gains planning.

For high‑income individuals, marginal rate management becomes critical. Even small timing decisions can produce meaningful savings.

The goal is not avoiding tax — it is paying the right amount, at the right time, with full compliance.

RRSPs remain one of the most effective tax planning tools available to salaried Canadian taxpayers.

They provide:

• Immediate tax deductions;
• Tax‑deferred growth;
• Retirement income flexibility;
• Estate planning benefits.

For high earners, RRSPs help shift income from peak earning years to lower‑tax retirement years. This lifetime smoothing often creates substantial savings.

RRSPs can also complement corporate retirement planning, individual pension plans, and investment strategies for affluent families.

Used strategically, RRSPs are more than a deduction — they are part of a coordinated wealth plan.

The Lifetime Capital Gains Exemption (LCGE) allows Canadians to shelter a significant amount of capital gains when selling Qualified Small Business Corporation shares.

For successful entrepreneurs, this can mean hundreds of thousands in tax savings.

Qualification requires:

• Proper share structure;
• Active business asset tests;
• Ownership history compliance.

Advance planning is often required years before a sale. Purification of assets and restructuring may be necessary.

For high‑value businesses, LCGE planning can materially affect after‑tax sale proceeds and retirement funding. But this is just one tool within many available to minimize taxes upon a successful exit.

TOSI rules limit income splitting with family members unless involvement or capital contributions justify it.

However, legitimate planning remains possible. Compensation for real work, capital investment, and risk participation can support reasonable structures.

For affluent families, planning must balance fairness, compliance, and tax efficiency. Proper documentation and structure are key.

Handled properly, family participation can still be part of a sound tax plan.

Year‑end planning allows you to finalize decisions before your tax year closes.

Opportunities often include:

• Income and expense timing;
• Bonus planning;
• Investment purchases;
• Loss utilization.

But the most effective planning happens throughout the year. Year‑end should be refinement, not the starting point.

For larger businesses and wealthier owners, quarterly planning often yields better outcomes and fewer surprises.

Canada offers numerous credits supporting innovation, hiring, and growth.

Common examples:

• SR&ED credits;
• Training credits;
• Apprenticeship credits;
• Industry‑specific incentives.

The challenge is documentation and eligibility tracking. Many businesses underclaim simply due to complexity.

Professional oversight ensures opportunities are not missed.

An estate freeze locks in your company’s current value for tax purposes while passing future growth to successors.

It helps:

• Cap tax exposure;
• Support succession;
• Potentially multiply lifetime capital gains exemptions;
• Transfer wealth efficiently.

Estate freezes are especially relevant for growing, high‑value businesses and affluent families planning generational wealth transfer.

They require careful legal and tax design but can be extremely powerful.

Only part of a capital gain is taxable, but inclusion rates still materially affect outcomes.

Timing, exemptions, and ownership structuring can influence results significantly.

For high‑net‑worth individuals with investment portfolios or business interests, capital gains planning is central to wealth preservation.

Structure affects taxation, risk, and flexibility.

Corporations, holding companies, and trusts each play roles depending on goals.

For successful and growing businesses, structure should evolve over time. What worked at startup may not be optimal at scale.

Strategic structuring supports growth, protection, and succession.

We work with business owners, professionals, and families seeking clarity and confidence in their tax strategy.

Our focus is proactive planning — not just compliance. We help align tax decisions with business, investment, and legacy goals.

Clients value our ability to explain complex matters clearly while delivering sophisticated planning where needed.

Thoughtful planning today builds stronger financial outcomes tomorrow.