Tax Planning

Tax Planning

Once the corporation has paid tax, the funds remaining increase the equity value of the company and are held in what is called retained earnings. If the business owner then wishes to access the retained earnings for personal use, they will be forced to incur a large tax loss, often in excess of one third of the value. Advantage has a process which effectively allows business owners to access the value of their retained earnings, without the tax loss.

It appears the Federal Government will allow the traditional tax
assessments to be utilized on the first $50,000 of annual income earned in a holding company. As an example the tax assessed on interest earned on any funds in your holding company is set by CRA at 50%. The tax to be assessed on all Holdco earnings above $50,000 annually is unclear. This tax rate is anticipated to be a very punitive, similar too or greater than that assessed interest income, to promote the transfer of these funds to you personally which will create the government desired dividend taxation. What appears to have no changes planned, is the tax rates to be used on income earned personally and reported on a personal tax return.
Advantage has a program that allows the Holdco funds to be invested into a financial structure that;
1) Is guaranteed
2) Is liquid in that it can be cashed at any time upon your request
3) Allows a personal Bank loan up to 100% of the Holdco invested amount.

Once the amount committed by your Holdco is now in your hands personally by way of a bank loan, the funds are directed to a Professional Portfolio Manager that;
1) Creates a cash flow to pay the bank loan monthly interest
2) Funds are placed in your account at Credential Securities allowing the funds to be 100 % liquid and redeemed upon request
3) Payment of gains made in this program to you personally allows for capital gains tax treatment on those funds.

The anticipated financial benefit is significantly better than what is achieved by leaving the funds in your Holdco or withdrawing the funds and working with a reduced amount after the dividend tax has been deducted.

Sample graphs will be produced for each individual’s specific situation.


Business Consulting

In certain situations our role with clients has evolved into highly involved working relationships. We have successfully aided some of our business owner clientele in optimizing their business operations and overall performance.

Our commitment is to connect you with an array of helpful financial services and products. We believe there is more to a successful financial strategy than just picking the right investments. Part of achieving success is to use strategies that provide peace of mind and a competitive edge.

Please contact us to learn about the techniques we use to advance your financial position both now and into the future. There is NO FEE to create a plan using respected proven professionals. Utilizing your current CPA or Financial Planner is an available option. Once you have accepted the plan, a mutually acceptable consulting fee will be agreed upon between you and Advantage.