Small business

Small business accountant in Vancouver.

Tax and planning for incorporated owners, with company and personal returns done together.

What we look at

What we plan for with owner-managed companies.

Paying yourself

Salary, dividends or a mix, planned around your cash needs, RRSP room, CPP and the corporation's tax position.

Shareholder loans

Amounts you take out of the company are tracked. A loan not repaid within one year after the company's year-end is generally taxed as income.

Family members

Paying a spouse or adult children through salary or dividends is limited by the tax on split income (TOSI) rules. We check what still works first.

The small business deduction

Your company's lower tax rate applies to the first $500,000 of active business income, and can shrink if passive investment income passes $50,000 a year.

Holding companies

When a holding company helps protect surplus cash, fund investments or prepare for a future sale, and when it only adds cost.

Year-end planning

Bonuses, dividends, equipment purchases and timing decisions made before your fiscal year-end, not after.

What we do for you

One CPA team handles your company and your personal returns, so decisions about pay, dividends and timing are made together.

Corporate year-end and T2 return
Compilation financial statements
Personal and family T1 returns
T4 and T5 slips for salary and dividends
GST/HST returns
Bookkeeping in QuickBooks Online or Xero
Payroll
Tax planning before your fiscal year-end

Industries

Businesses we work with often.

Guide

Running an incorporated business in BC: what to plan for.

Most owner-managed companies make the same handful of decisions every year. Getting them right is where most of the tax savings are, and it happens before your year-end, not at filing time.

How your company is taxed

A Canadian-controlled private corporation in BC generally pays a combined 11% on the first $500,000 of active business income, thanks to the small business deduction. Income above that is taxed at the general combined rate of 27%. When you take money out personally, you pay personal tax on top, so the real question is how much to leave in the company and how to take out the rest.

Salary, dividends or a mix

Salary is deductible to the company, creates RRSP room and builds your Canada Pension Plan, but both you and the company pay CPP contributions.
Dividends are paid from after-tax profit, don't require payroll and avoid CPP, but don't create RRSP room.
A mix often works best: enough salary for RRSP room or a mortgage application, with dividends for the rest.

A simple example

An owner who needs $120,000 a year to live on could take a salary up to the RRSP room they want and top up with dividends, leaving the remaining profit in the company at the lower rate. The right split depends on your other income, your spouse's situation and your plans, so we model it each year.

Taking money out without surprises

Money you take from the company that isn't salary or a dividend is recorded as a shareholder loan. If it isn't repaid within one year after the end of the company's tax year, it's generally added to your income. We track the shareholder account through the year so there's no scramble at year-end.

When a holding company makes sense

Once your company earns more than you need personally, a holding company can hold the surplus, protect it from business risk and keep your operating company eligible for the lifetime capital gains exemption if you sell. Watch the passive income limit: investment income above $50,000 a year starts to reduce the small business deduction.

Your year-end checklist

Review salary, bonuses and dividends two to three months before year-end
Time major equipment purchases and confirm how they'll be depreciated
Clear or document shareholder loan balances
Confirm GST/HST filings are up to date
Plan instalments so the balance due isn't a surprise

Have a question about your situation?

Book a call

Working with us

In person in Vancouver, or by video from anywhere in BC.

Start with a short call

We learn what you need and give you a quote upfront.

Connect securely

You authorize us with the CRA and share documents through our secure client portal.

We do the work

Your file is prepared and reviewed by a CPA, with questions sent as they come up.

Review together

We walk you through the results by phone, video, at our office or wherever suits you.

Questions

Common questions.

Do I need to incorporate my business?

Not always. Incorporating helps most when the business earns more than you need to live on, so profit can stay in the company at a lower rate. We look at your numbers before you decide.

Should I pay myself salary or dividends?

It depends on your income, RRSP room and the company's tax position. Most owners use a mix, planned yearly.

Can you take over from my current accountant?

Yes. With your permission we request your prior returns and working papers, even partway through the year.

Do I need to come to your office?

No. Most clients meet by phone or video, and we're happy to come to you if you'd rather meet in person.

What's the corporate tax rate for a small business in BC?

Generally 11% combined on the first $500,000 of active business income, and 27% above that.

When is my corporate tax return due?

Six months after your fiscal year-end. Any balance owing is usually due two or three months after year-end.

Can I pay my spouse from the company?

Yes, if they do real work, at a reasonable salary. Dividends to family are limited by the TOSI rules.

How are fees set?

Fees depend on the size and complexity of your file. We give you a quote upfront after a short first call.

Talk to a CPA about your company.

Book a call