10 Nov Private Corporation Tax Planning
On July 18, 2017, the federal government released a discussion paper and draft legislation that addressed tax planning strategies for private corporations. The paper focused on three main areas: sprinkling income using private corporations, holding passive investments inside a private corporation that were acquired with low tax rate business income, and converting regular income into capital gains. Through a series of government announcements on October 16 through October 24, the Government of Canada has eliminated some, but not all, of these proposals. The attached is a general overview of the government’s announcements in these areas as of October 24, 2017.