Changes in taxation affecting small business announced by the Department of Finance
Recently the Department of Finance announced proposed changes to the Income Tax Act that will likely have a significant restrictive impact on broadly used tax planning strategies for Canadian private corporations. The proposed changes include increases to income tax rates available to corporations carrying on certain types of business activities and new limitations on the ability of private corporations to split dividends and capital gains to multiple family shareholders accessing those shareholders’ lower marginal personal income tax rates. The Federal Government has invited comments from the public untilOctober 2, 2017 and most of the proposed measures would apply to 2018 and subsequent taxation years.
We are following the progress of this consultation closely, including continuing to assess the impact on tax planning for many of our clients. We will also be updating our website periodically with general information regarding the proposed changes as the prospective issues that are likely to affect many of our clients are more clearly identified and enumerated on.
We will be contacting clients impacted individually in the near future to discuss options and changes in tax planning that may need to occur as a result.
Please feel free to contact Sandy, Adam or Doug if you have any questions.
