Corporations Quick guide
7 things to do in the first 30 days after incorporating in BC
Open a bank account in the company's name. Decide how the books will be kept. Set up the CRA accounts the company needs.
Life events › Incorporating
Incorporating
A corporation is a separate taxpayer with its own filings, its own payroll obligations when you pay yourself a salary, and its own rules for insurance it owns. The personal services business rules decide whether the CRA treats the corporation as a real business at all.
How the pieces connect
- First 30 days
- Salary or dividends
- Payroll remittances
- Personal services business test
- Records before year end
- Corporate-owned insurance
- Scheme warning
Insurance, TFSAs, RRSPs, RESPs and tax planning solve different problems. The goal is not to sell one product as the answer to everything. Each path below shows how the pieces connect for one event, and which guide to read for each piece.
Guides for this path, in reading order
Corporations Quick guide
Salary or dividends? 5 questions to ask before paying yourself from your corporation
It depends on you and the company, not on a rule of thumb. Salary is employment income: it builds RRSP room and CPP, but it needs a payroll account and deductions through the year.
Small business, GST and payroll Quick guide
You paid yourself a salary from your corporation. Did you forget the payroll remittances?
If your corporation pays you a salary, it is an employer. It must open a payroll account and take CPP and income tax off each pay.
Corporations Quick guide
You incorporated. The CRA could still treat you like an employee: 5 questions about personal services businesses
Having a corporation does not by itself decide how the CRA taxes the income.
Corporations Quick guide
What records should a corporation keep before year end? A 10-item check
Have ten things ready before your year end. Every bank and credit card statement.
Corporations Practical guide
Corporate year end: what should you give your tax preparer?
Bring your bookkeeping records for the year. Bring bank and credit card statements.
Corporations Practical guide
Does an inactive corporation still need to file a T2 return?
Yes. Every resident corporation must file a T2 return for every tax year, even if it had no income, no activity and no tax to pay.
Corporations Quick guide
Life insurance inside a corporation: 5 tax questions owners should understand
A private corporation that receives life insurance proceeds as beneficiary can add the proceeds, minus the policy's adjusted cost basis, to its capital dividend account.
Insurance Quick guide
Someone promised you a tax-free insurance strategy? 6 questions to ask before signing
Ask six things. Where exactly does the tax saving come from, in the Income Tax Act.
What belongs with a lawyer: Incorporation documents, shareholders' agreements and the minute book are legal work.
Other life events
Want this worked through for your situation?
Call us or request a callback. We explain the tax side; insurance is arranged by Parminder Singh Oberoi through Punjab Insurance Agency Inc.; legal documents need a lawyer or notary.