On July 18th, the Liberal Government released a consultation paper, “Tax Planning Using Private Corporations” outlining proposed changes to income sprinkling, the availability of the lifetime capital gains exemption, converting income to capital gains, and earning of passive income within a corporation. Some of the changes are proposed to take effect on July 18, while others are intended to take effect January 1, 2018. The Government consultation period ended on October 2.
Areet Kaila, Cathie Brayley and Richard Weiland presented on the topic to other tax and legal professionals at the Canadian Bar Association’s Business Law Section Meeting. They took attendees through the proposals and discussed how they will affect in a significant way the taxes payable and the compliance costs facing private companies and their shareholders.