What is a Personal Services Business?
A personal services business is a corporation the CRA treats as a disguised employment relationship, typically an incorporated contractor providing services to […]
What is the difference between Permanent and Term Life Insurance?
Term life insurance provides coverage for a fixed period at a lower premium; permanent life insurance provides lifetime coverage and can accumulate […]
What is Passive Income?
Passive income is investment income earned inside a corporation, interest, rental income, and taxable capital gains, that does not qualify for the […]
What is Owner Compensation Planning?
Owner compensation planning is the deliberate design of how income is extracted from a corporation, balancing salary, dividends, and other strategies to […]
What is a Non-Arm’s Length Transaction?
A non-arm’s length transaction is a deal between related parties, family members, a shareholder and a corporation, or entities under common control, […]
What is the Lifetime Capital Gains Exemption (LCGE)?
The LCGE is a federal exemption that allows eligible Canadian business owners to shelter a significant portion of capital gains on the […]
What are Instalment Penalties?
Instalment penalties are interest charges the CRA imposes when required tax instalments are paid late, short, or not at all, calculated from […]
What is Income Splitting?
Income splitting is the practice of directing corporate income to family members in lower tax brackets to reduce the household’s overall tax […]
What is HST/GST and how do Input Tax Credits work?
HST and GST are consumption taxes collected by businesses on behalf of the CRA; input tax credits allow recovery of the HST/GST […]
What are Home Office Expenses?
Home office expenses are the portion of household costs, rent, utilities, internet, and maintenance, that an incorporated business owner can deduct when […]
What is the difference between a HoldCo and an OpCo?
An OpCo is the operating company that runs a business; a HoldCo is a separate corporation that sits above it, holding shares […]
What is Goodwill?
Goodwill is the value of a business above its identifiable assets, reflecting customer relationships, reputation, brand, and earning power that cannot be […]