Quote:
Originally Posted by Myst
So if someone has $300,000 in a company for 2-3 years (already paid the 21% taxes), then that money goes to his personal account .. how much taxes does he pay??
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that money would be dividends, and dividends are taxed similarly to regular salary income
The best way to save taxes in Canada on income of $100k/yr is this:
- Don't take a salary
- All the money goes to your corporation, which is then taxed at 17-19% depending on your province (up to $400k profit/yr)
- take dividends from your company (if you only have dividend income in the year, the first $40k you draw is tax free)
if you happen to be partner with your wife in the business and she can legitimately own 50% of the shares, you could each draw $40k tax free per year (your corporation will have paid taxes on its profit prior to remitting dividends, but on the personal tax level it would be tax free)
Talk to an accountant, there are many ways of reducing taxes.