Corporate & Business Taxation
Part of owning an incorporated business or investment company involves the requirement to file and pay corporate taxes to the Federal and Provincial Governments.
Tax rules and regulations are constantly changing, which makes it difficult and onerous for small businesses to keep up to date with their obligations. A corporate accountant can assist with businesses’ tax obligations.
Our team will be happy to discuss what we can do to assist with all of your corporate and business taxation needs.
Some of the ways we can help with Corporate Tax Compliance
At NG Chartered Professional Accountants, we provide a wide range of services to private businesses and corporations to help relieve the burden of taxes and also assist owners in planning their finances for the future.
Having a well thought out tax plan helps both private companies and owners minimize taxes and optimize personal wealth.
Preparation of Corporate T2 Tax returns
Issuance of T4 & T5 slips
Tax Estimates
Complex Tax planning
Incorporation & registering for tax
Investment Tax tracking
Filing of HST & GST returns
Assistance with CRA reviews & audits
Filing of payroll & T4 summaries with the CRA
Corporate Structuring & Reorganizations
High-revenue businesses outgrow their initial structures. As your business grows, proactive restructuring protects assets, optimizes tax flow, and positions the company for long-term success. At NG CPA, we advise London, Ontario business owners on the most tax-efficient corporate structures for their situation.
Estate Freezes & Succession Planning
Transfer future growth to the next generation or key employees while minimizing immediate tax impact. We structure estate freezes that lock in the current value for the founder and pass future appreciation to successors — with maximum tax efficiency.
Corporate Rollovers & Amalgamations (Sec. 85, 86, 87)
Move assets into corporations tax-efficiently or combine multiple entities under one structure. We advise on Section 85 rollovers, Section 86 share exchanges, and Section 87 amalgamations to achieve your restructuring goals without triggering unnecessary tax.
Holding Company Structuring & Creditor Protection
Setting up OpCo/HoldCo structures to safely dividend excess cash out of the operating company and protect it from operational liabilities. A properly structured holding company is one of the most powerful tools for long-term wealth preservation.
Advanced Wealth & Exit Planning
At the $3M+ revenue level, business owners are thinking beyond day-to-day operations — they’re planning how to sell, transition, or pass on what they’ve built. We help you prepare years in advance so that when the time comes, you keep the maximum amount of what you’ve earned.
Lifetime Capital Gains Exemption (LCGE) Purification
Ensuring your corporation qualifies for the Lifetime Capital Gains Exemption well before a sale. With proper purification planning, a business owner can shelter nearly a million dollars in capital gains from tax — but this requires strategic preparation, not last-minute scrambling.
Purchase and Sale Advisory
Structuring the buying or selling of a business to minimize the tax hit. Share sales vs. asset sales have dramatically different tax consequences for both buyer and seller — we analyze both scenarios and negotiate structures that work in your favour.
Post-Mortem Tax Planning
Designing strategies — including pipeline planning and s.164(6) elections — to avoid double taxation when a business owner passes away. Losing a business owner shouldn’t mean losing a significant portion of the estate to avoidable tax. We plan for this well in advance.
Niche & Specialized Advisory
Some business owners have highly specific tax challenges that require more than general advice. We go beyond generic “complex tax planning” to address the exact pain points of your industry and situation — whether you’re a medical professional, a business owner with a growing family, or someone looking to multiply the capital gains exemption.
Medical Professional Corporation (MPC) Optimization
Specifically for physicians — managing passive income rules that restrict the small business deduction, optimizing salary vs. dividend remuneration strategies, and integrating corporate investment portfolios within your MPC. We understand the unique regulatory environment that medical professionals operate in and work closely with Wealth Advisors – while always remaining independent.
Family Trust Setup & Management
Using discretionary family trusts for income splitting (where applicable under TOSI rules) and multiplying the capital gains exemption among family members. A family trust, properly established, can multiply your LCGE across multiple beneficiaries — dramatically reducing the tax on a business sale.
When do I need to register for GST/HST?
You must register for a GST/HST account when your total worldwide taxable sales exceed $30,000 in a single calendar quarter or over 4 consecutive calendar quarters.
When is a corporation required to file T4 and T5 slips?
T4 and T5 information slips must be issued and filed by the end of February following the calendar year to which they apply. T4s are required to report wages and salaries paid to employees, while T5s are required to report dividends to shareholders or any interest paid.
What is a Capital Dividend Election?
A capital dividend election allows a private corporation to distribute certain tax-free amounts – such as the non-taxable portion of capital gains or life insurance proceeds – to its Canadian-resident shareholders. This requires filing Form T2054 with the CRA on or before the day the amount becomes payable.
Should I pay myself using a salary or a dividend from my corporation?
This decision depends on your personal cash flow needs, whether you want to generate RRSP contribution room (which requires a salary), and your broader corporate tax structure. Contact us today for help analyzing both options to ensure you optimize your overall personal and corporate tax liability.
When should I start thinking about business transition or succession planning?
You should ideally begin business transition planning at least 3 to 5 years before you intend to exit or sell the business. Starting early provides enough time to maximize the company’s valuation and implement tax mitigation strategies.
What is an estate freeze and when should I do one?
An estate freeze is a tax planning strategy where a business owner locks in (freezes) the current value of their shares and transfers future growth to the next generation or key employees. It is done using a share exchange under Section 86 of the Income Tax Act. An estate freeze is typically considered when a business has grown significantly in value and the owner wants to limit their future capital gains exposure while allowing successors to participate in future growth. Ideally, an estate freeze is done 2+ years before a business sale to set up a family trust and multiply the LCGE across beneficiaries.
What is the Lifetime Capital Gains Exemption (LCGE) and how do I qualify?
The Lifetime Capital Gains Exemption (LCGE) allows Canadian business owners to shelter a significant portion of capital gains from the sale of qualifying small business corporation shares from income tax. For 2024 and forward, the exemption is approximately $1,016,602. To qualify, the shares must be Qualified Small Business Corporation (QSBC) shares, meaning: the corporation must be a Canadian-Controlled Private Corporation (CCPC); at least 90% of its assets must be used in an active business at the time of sale; and for the preceding 24 months, more than 50% of assets must have been used in active business. LCGE purification strategies — often completed 2+ years before a sale — involve removing excess passive assets from the corporation to meet these tests.
What is a Section 85 rollover and why would I use one?
A Section 85 rollover is a provision in the Canadian Income Tax Act that allows an individual or business to transfer eligible property (such as assets, accounts receivable, or inventory) to a Canadian corporation on a tax-deferred basis. You elect an agreed amount — often equal to the property’s adjusted cost base — so no immediate tax is triggered on the transfer. Section 85 rollovers are commonly used when incorporating a business, moving assets into a holding company, or restructuring corporate ownership. A joint election (Form T2057) must be filed with the CRA within the required deadline.
What is an OpCo/HoldCo structure and what are the benefits?
An OpCo/HoldCo structure involves creating a holding company (HoldCo) that owns shares in your operating company (OpCo). Excess profits generated by the OpCo are paid up to the HoldCo as inter-corporate dividends — generally tax-free between connected Canadian corporations — where they are sheltered from the operational liabilities of the business. Key benefits include creditor protection (business creditors cannot reach assets held in HoldCo), tax deferral on passive investment income, estate planning flexibility, and the ability to multiply the Lifetime Capital Gains Exemption across family members through a family trust structure.
What is a family trust and how does it help with tax planning?
A discretionary family trust is a legal arrangement where a trustee holds and manages assets for the benefit of specified beneficiaries (typically family members). In corporate tax planning, a family trust often holds shares in a family business corporation. Key benefits include: (1) income splitting — the trust can allocate dividends to lower-income adult family members, subject to TOSI rules; (2) multiplying the Lifetime Capital Gains Exemption — each adult beneficiary may shelter their own LCGE on a business sale, potentially sheltering millions in gains; and (3) succession and estate planning flexibility. A family trust must be established at least 2 years before a business sale to access the LCGE multiplication benefit.
What is the difference between a share sale and an asset sale when selling a business?
In a share sale, the buyer purchases the shares of the corporation and takes on all its assets and liabilities. In an asset sale, the buyer purchases specific assets from the corporation. For sellers, share sales are generally more tax-advantageous because capital gains may be sheltered by the Lifetime Capital Gains Exemption (LCGE). For buyers, asset sales are often preferred because they can depreciate purchased assets at current market values and avoid inheriting unknown liabilities. The final transaction structure is typically negotiated, and a price adjustment is sometimes used to bridge the tax gap between what the buyer wants and what the seller needs.
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