Читать книгу Kickstart Your Corporation - Andrew Feindel - Страница 34

 Background: At present, retaining eligible dividend income within an Ontario corporation defers 0.49% in personal tax (the difference between the Part IV tax rate of 33.33% and the top personal marginal tax rate on eligible dividends of 33.82%). Assuming the Liberal party platform tax rate proposals are implemented, the top personal tax rate on eligible dividends will jump to 39.34%.123456 Ontario Limited has a general rate income pool (GRIP) balance of $1,295,018 (calculated as of April 30, 2015), which would allow for the payment of an eligible dividend of the same amount.The payment of a $1.3 million dividend would result in personal tax of approximately $439,660, but generate a refund of tax to the corporation of $433,333 (an incremental tax cost of $6,327).

 Recommendation: As an alternative to paying a dividend, 123456 Ontario Limited could redeem a portion of the preferred shares issued to you.Assuming the preferred shares have a paid-up capital (PUC) (to be confirmed by your accounting firm), a redemption of $1.3 million worth of shares would generate a taxable dividend of approximately $1.3 million to you (the taxable dividend is the difference between the redemption amount and the PUC of the shares).The dividend can be designated by the corporation as an eligible dividend to the extent of the corporation's GRIP balance at the time of the share redemption.The advantage is that for a current net tax cost of $6,327, the future tax exposure of your estate will be reduced by a minimum of $347,880 (based on the anticipated 2016 top tax rate on capital gains of 26.76%), but more likely by as much as $519,220, assuming the preferred shares will be redeemed on your passing (and based on an anticipated 2016 top tax rate of 39.34% on eligible dividends).

While this transaction took several steps, one can see that with the easing of restrictions on corporations in retirement, there are a lot more potential opportunities for planning!