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Old 09-14-2004, 12:10 AM  
rickholio
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Join Date: Jan 2004
Location: Nor'easterland
Posts: 1,914
Oh, yeah

Canada (corporate):

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Base federal corporate tax rate (2004): 13.1% up to 250k, 22.1% beyond 250k.

Base provincial corporate tax rate(2004): Varies between 3%(New Brunswick and for some businesses in alberta) and 8.9%(Quebec) up to 250k, average is 5.3%. Beyond 250k, average is 13.9%.

Total effective corporate tax rate (averages): 18.4% <250k, 36% on income beyond 250k.

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Note: Of course, noone pays anywhere close to these amounts. The corporate tax system in Canada is so full of things that can be depreciated and deducted it's conceivable that with careful tax planning and expenditure control your business could pay little or nothing. Small business is particularly blessed, as shareholders are allowed up to 25k in dividends tax-free per year, and items purchased for the business can be claimed for GST refund.

It should be a truism in Canada that if you make over $70k/year, you absolutely must incorporate if possible. The tax benefits are massive... the 25k of tax free dividend alone covers the costs of lawyer and accountant fees easily.
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