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.
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.
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”).
Determining your optimal salary/dividend mix should be reviewed at least annually considering the following.