If you are a shareholder of a private corporation, a loan from your corporation can be an easy way to access cash for your personal needs, at least in the short term.
A fourth strategy to deal with double taxation of your shares also requires the windup of your professional corporation within one year of your death to create a capital loss to offset your capital gain.
As an incorporated professional, your tax planning is a year-round process. Here are three tax strategies to help make your professional corporation tax-efficient:
One strategy to eliminate double taxation on the value of your professional corporation’s shares uses a windup of the corporation to create a capital loss that offsets your capital gain.
The Corporate Pipeline strategy, in summary, requires the creation of a new corporation at death to allow your heirs to extract your professional corporation’s assets on a tax-free basis.
Your estate plan should include strategies to reduce Ontario Estate Administration Tax
As a health care professional, your personal income may be high enough to be taxed at Ontario’s highest personal marginal tax rates.
An often-overlooked issue for incorporated healthcare professionals is the potential for the value of their professional corporation shares to be taxed twice (i.e. “double tax”).