Your business clients aren’t the only ones who may be affected by Finance Minister Bill Morneau’s plan to tighten the tax rules for private corporations.
As reported in a study by CBC News, even Canada’s political class could face higher taxes. The study finds that “nearly one-third of Trudeau’s cabinet, including Trudeau himself, own or have recently owned private corporations.”
CBC adds, “Overall, one in four MPs, or 26% of the House of Commons, own or have a significant interest in one or more private corporations, from farms and restaurants to holding companies with investment portfolios.”
Read the full CBC article, which looks at which party has the highest rate of private corporation ownership.
Incorporated professionals or owners of private corporations are about to lose significant tax planning strategies, according to proposals by Morneau, whose government wants to level the playing field between those who use corporations to structure their finances and those who don’t.
Morneau announced details about the tax changes in July, which would affect private corporations using strategies such as income sprinkling and holding passive investments inside their corporations.