ALL >> Business >> View Article
Corporate Tax And Immigrant Trusts
Total Articles: 48
Corporate tax in Canada forms a very small part of the total revenue generated by all kinds of taxes in the country. All the corporate houses in Canada are taxed on the gains from different commercial based activities undertaken and on the capital that they generate which is then disbursed to the shareholders as dividends. A credit is given to the individuals who get dividends to show the payment of corporate tax. Taxation on the dividends is as a result much more than most other methods of generating income.Half of this income is brought under the tax laws and the rest half is excluded.
Companies may subtract the capital cost on the basis of regulations in the Capital Cost Allowance with the deductions allowed on any property that was owned for a short interval. These deductions are also on the property which is re-leased to the original seller.
From the year 2002, many large corporate houses and companies converted themselves into “Trusts” to reduce or completely eliminate their income taxes.This fast tracked the trust sector’s growth a lot. However the government plugged this loop hole by declaring that any new trusts will be treated like the corporations and will be taxed similarly and these new rules were also applicable to the older or the existing trusts to which stopped such modifications by the corporates.
In Canada corporations were also taxed on the capital income by them which were removed completely at the federal level in from January 2006 but some territories continued to charge these taxes till the year of 2012.A review was done by the Canadian Finance Department to determine whether corporate tax should re-introduce on the group level. This review however did not bear any solution and as a result of which such a group taxation law was not formed as the department didn’t find this as a need of the hour.
The tax returns of an individual staying in Canada are evaluated on the basis of the income sources whether it is domestic or from international commercial transactions. Such an immigrant can however approach an immigrant trust, and let the trust manage such commercial activities on his/her behalf. As a result, they can save taxation on such assets for a period of 5 years.
Such a trust can be set up before or a maximum up to 5 year after the individual immigrates to Canada. Such a trust should be non-resident in nature i.e, it should be in the hands of a non-resident trustee or under the control of a set of laws which are not under Canadian jurisdiction. The individual should not have any kind of transaction with a citizen of Canada too.
Once the immigrant becomes a Canadian citizen, the profits generated by the assets under the immigrant trust are tax exempted for 5 years. The setting up of immigrant trusts requires a lot of financial planning as such trusts provide a number of tax related benefits, financial information and safety.
Ken Donaldson is a chartered accountant who practices as an independent tax specialists. He also author of corporate tax, in this article he provides immigrant trusts tips. For more information you can visit Taxca.com.
Business Articles1. Some Facts About Event Planning
2. Why Should I Hire An Event Planner?
3. Why Should I Hire An Event Planning Agency For Corporate Events?
4. Render A Successful Event With The Right Event Planning Agency
5. Event Management Agency – To Manage Events Successfully
6. Denis Vincent - Le Parcours Extraordinaire D'un Homme Ordinaire
Author: Denis Vincent
7. Rising Damp Treatment For Your House – Who To Choose And How
Author: George Dean
8. Certified Packers And Movers In Gurgaon
Author: gajendra singh
9. Benefits Of Using Pressure Washing Services
Author: Anu Radha
10. Understanding Payroll Fraud And Preventing It
Author: NetZealous LLC, DBA TrainHR
11. Glow Art Board Add A Touch Of Glow To Your Art
Author: baby gander
12. Sukanya Samriddhi Yojana Calculator
Author: Ross Barkely
13. Importance Of Recycling The Waste Water
Author: Manoj Shukla
14. Mold Removal Toronto With The Best Package Of All Time
Author: jacob fairley
15. Find Property For Rent
Author: Find Property For Rent