Corporate tax · London, Ontario
Corporate tax planning & reorganizations in London, Ontario
Section 85 rollovers, capital dividend accounts, amalgamations, butterfly transactions and corporate wind-ups, planned and filed by a CPA who specializes in corporate tax.
Corporate tax accountant
Restructure your corporation without an unexpected tax bill
Owner-managed corporations change over time. You may add a holding company, bring in a partner, combine companies, split a business between shareholders or close a corporation you no longer need. Each step can trigger tax if it is not planned and elected correctly.
Major Tax & Accounting, CPA plans the reorganization, models the tax result before anything is signed, prepares the CRA elections and works with your lawyer on the legal documents. You get one corporate tax accountant in London, Ontario who stays with the file from the first call to the final filing.
Corporate services
Corporate reorganization services
Section 85 rollovers
A section 85 rollover lets you transfer property such as shares or business assets to a Canadian corporation on a tax-deferred basis. You and the corporation elect an agreed amount on form T2057, so tax on the gain is postponed instead of paid today.
We use section 85 to incorporate a sole proprietorship, set up a holding company, complete an estate freeze or move investments into a corporation. We set the elected amount, calculate the share consideration and file the election on time.
Capital dividend account (CDA)
The capital dividend account tracks tax-free amounts a private corporation receives, such as the non-taxable portion of capital gains and life insurance proceeds. With a valid election, these amounts can be paid to shareholders as tax-free capital dividends.
We calculate your CDA balance, confirm it before a dividend is declared, prepare the T2054 election and help you avoid the penalty tax on an excessive election.
Amalgamations
An amalgamation combines two or more corporations into one, usually on a tax-deferred basis. It can simplify your structure, reduce yearly accounting and filing costs and consolidate assets in one company.
We review the tax attributes of each corporation, plan the timing of the deemed year-end and prepare the final and first-year corporate tax returns.
Butterfly transactions
A butterfly reorganization divides a corporation’s assets between shareholders on a tax-deferred basis. It is often used when siblings, family members or business partners decide to go their separate ways.
Butterfly transactions follow strict rules in the Income Tax Act. We plan each step in advance, value the assets and coordinate with your lawyer so the split can proceed without triggering immediate tax.
Corporate wind-ups
Closing a corporation involves more than filing a final return. Winding up a subsidiary into its parent can be tax-deferred, while winding up and paying out individual shareholders creates deemed dividends that need careful planning.
We plan the distribution, recover refundable taxes where possible, pay out the capital dividend account, file the final T2 return and close the CRA program accounts.
Who we help
Corporate tax planning for owner-managed businesses
- Business owners setting up a holding company
- Incorporated professionals, including physicians, dentists and lawyers
- Family businesses planning an estate freeze or succession
- Shareholders separating or selling part of a business
- Owners closing or simplifying a group of corporations
Industries we serve
We speak your industry’s language
Every industry has its own tax traps and opportunities. We know them, so you don’t have to.
Lawyers & Law Firms
Trades & Contractors
Physicians
Dentists
Real Estate Investors & Landlords
Restaurants & Hospitality
Consultants & Professional Services
Retail & Ecommerce
Family Businesses
Questions
Frequently asked questions
What is a section 85 rollover?
It is an election under section 85 of the Income Tax Act that lets you transfer property to a Canadian corporation and defer the tax on any gain. You and the corporation file form T2057 to choose the transfer amount.
When should I amalgamate my corporations?
Amalgamation often makes sense when you have several companies with overlapping purposes, duplicate yearly costs or assets you want held in one company. We review the tax attributes of each company before recommending it.
Can I pay myself a tax-free dividend from my corporation?
Yes, if your corporation has a positive capital dividend account balance and files a valid election before or when the dividend is paid. We calculate the balance first so the election is not excessive.
Do you work with my lawyer?
Yes. Reorganizations need both tax planning and legal documents. We prepare the tax plan and elections and coordinate with your lawyer, who drafts the resolutions and agreements.
Not sure where to start?
Book a 15 minute call. We’ll listen, ask a few questions and tell you exactly how we can help.