On July 18, the Canadian government released legislative proposals and a consultation paper targeting three tax planning strategies that, in the government’s view, use private corporations to gain unfair tax advantages for high-income individuals. The draft proposals are complex and will impact every Canadian private company and their shareholders.
The proposals focus on three main areas:
- Income splitting with family members to reduce the overall family tax burden
- Perceived tax advantages achieved through the accumulation of a passive investment portfolio owned by a private corporation
- Strategies that convert regular income or dividend income of a private corporation into capital gains, which are taxed at lower tax rates
Read more about the proposed changes, how to submit a response to the government and listen to PwC’s webinar on this topic.
If you have any questions about how these changes could impact you and your business, please reach out to your PwC Canada chapter member.