2023 Year-End Tax Planning for Owner-Managers

Canadian corporate and personal tax rates are constantly changing. Combine the complexity of Canada's tax system with elements such as the NERDTOH, ERDTOH, GRIP, CDA, employer health taxes, CPP, EI, marginal tax rates, along with the constant tax changes, client objectives, and future unknowns makes the tasks of remuneration planning especially tricky. In this session we will be reviewing tax rates across Canada in 2023 and 2024 and share which types of income are subject to under-integration or over-integration. We will also explain the details of the RDTOH accounts, potential traps, and how to optimize the types of dividends to pay when balances exist in both RDTOH accounts and GRIP. We'll also explore optimization strategies using salaries, dividends, capital gains strips, and the impacts on balances such as the AAII. Finally, we'll review many new tax policies such as the Alternative Minimum Tax, the expanded reporting for Trusts, mandatory disclosure rules, notifiable transactions, intergenerational transfers, and more.

Topics discussed:

• The principle of Integration and integrated tax rates by province
• Tax rates 2023 vs. 2024
• Update on changes to the Alternative Minimum Tax
• Understanding and optimizing the NERDTOH & ERDTOH accounts
• The impacts of the passive income grind to the small business deduction limit from adjusted aggregate investment income and province opt-outs
• Opportunities to minimize the small business deduction grind
• Salaries vs dividends vs capital gains optimization
• Year-end tax planning recommendations
• Updates from the 2023 Fall Economic Statement
• Update on enhanced trust reporting, mandatory disclosure rules, Bill C-208 Intergenerational transfers, and EIFEL legislation