Generally speaking, taxable Canadian corporations can pay dividends to other taxable Canadian corporations on a tax-free basis. For instance, consider a typical corporate structure where an operating company (Opco) is wholly owned by a parent corporation (Holdco), which in turn is owned by individual shareholders. A common practice used by many accounting practitioners is to…
Effective October 17, 2016, all high-ratio mortgages (those where a borrower puts less than 20% down) must satisfy a mortgage stress test. Essentially, a borrower must now qualify using a higher interest rate notwithstanding the fact that their lender is currently offering mortgages at a lesser rate. Q: What interest rate must now be used…
Prior to the 2016 federal budget there was a perceived abuse that certain corporate groups were benefiting from a multiplication of the small business deduction. To curb this behavior the budget introduced certain measures that aim to, amongst other things, prohibit a corporation from claiming the small business deduction on income received from certain private…