Small Business Tax Help in Canada

The Most Common Small Business Tax Questions We Answer

• Should I incorporate my business?
  Incorporation makes sense when your business earns more than you personally need — typically once profit exceeds $80,000–$100,000. At that point, leaving money in the corporation at 11–12% tax (vs 46%+ personal tax) creates significant long-term savings. We run the exact numbers for your income level and province.
• How much should I pay myself — salary or dividends?
  The right mix depends on your total income, your province, your RRSP room, and your CPP strategy. There is no universal answer. We calculate the optimal split for your specific situation — often saving thousands compared to a default approach.
• When do I have to register for GST/HST?
  The moment your cumulative taxable revenue exceeds $30,000 in any single calendar quarter or four consecutive quarters, you must register. We also advise on whether voluntary early registration is worthwhile for input tax credits on your startup costs.
• What can I deduct as a business expense?
  Home office, vehicle (mileage log required), professional development, software, equipment, meals (50%), advertising, professional fees, and more. The key rule: the expense must be incurred to earn business income. We review your expense list and flag anything CRA could challenge.
• My corporation has a large cash balance — what should I do with it?
  Leaving too much passive cash inside your operating company can reduce your small business deduction and create liability. A holding company structure lets you move cash out tax-free and invest it while protecting it from business creditors.
• I took money from my corporation — is that a shareholder loan?
  If you withdrew money and did not declare it as salary or dividends, it is a shareholder loan. It must be repaid within one year of your fiscal year-end or CRA will add the entire amount to your personal income. We help you track and resolve shareholder loan balances before they become a problem.

The Tax Advantage of a Small Corporation in Canada

Canada's tax system creates a powerful incentive to earn income through a corporation rather than personally. Here is the core reason:

That $16,800 difference stays in your corporation, compounding year after year. Over 10–20 years, this tax deferral creates substantial wealth — even accounting for the personal tax you eventually pay when you draw the money out.

Free Tools to Start

Use these free calculators to understand your current tax position before your session: