To set up dividend:
- must set up dividend if there is aggregate investment income (e.g. rental income, invsetment income(mutual fund, stock), foreign investment income)- divid dividend in to taxable dividend and capital dividend (capital dividend is based on current taxable capital gain)
- amount of dividend is based on shareholder equity, try to reduce it to zero"
- refundable dividend tax will be available if there is aggregate investment income and dividend has been set up
- dividend refund is lesser of refundable dividend tax OR 1/3 of dividend
- most of the the corporation is ineligible dividend
If there is dividend set up last year, on current remove it and put it to retained earning
Tax:
1Schedule 3Box450
2Schedule 100Box 3700 or 3701
Decision:
1 if you want to bonus down to minimize corp income tax or match small business decision
2 if shareholders want to earn deduction (cpp, ei)
3 # of shares that shareholders have
4 is the dividend eligible or not (eligible meaning eligible for small business deduction, means lower tax)
5 tax bracket of shareholders
- must set up dividend if there is aggregate investment income (e.g. rental income, invsetment income(mutual fund, stock), foreign investment income)- divid dividend in to taxable dividend and capital dividend (capital dividend is based on current taxable capital gain)
- amount of dividend is based on shareholder equity, try to reduce it to zero"
- refundable dividend tax will be available if there is aggregate investment income and dividend has been set up
- dividend refund is lesser of refundable dividend tax OR 1/3 of dividend
- most of the the corporation is ineligible dividend
If there is dividend set up last year, on current remove it and put it to retained earning
Tax:
1Schedule 3Box450
2Schedule 100Box 3700 or 3701
Decision:
1 if you want to bonus down to minimize corp income tax or match small business decision
2 if shareholders want to earn deduction (cpp, ei)
3 # of shares that shareholders have
4 is the dividend eligible or not (eligible meaning eligible for small business deduction, means lower tax)
5 tax bracket of shareholders