Background Information:

To make sure that all readers have a basic understanding of what the Finance Minister is proposing, here is a summary and a web reference with more details:

First, they propose that Tax Sprinkling (Income Splitting) should be disallowed. For example, if you compensate any member of your family, especially your adult children between the age of 18–24, and CRA decides, that under the “reasonableness test”, they are being overpaid for their role, CRA will assess them personal taxes at the maximum personal tax rate. They will, also, charge taxes at the maximum personal rate for all income earned from the invested funds that were received from the corporation – income on income.

by Florian Meyer

When you finally admit to yourself that your business is in trouble, you also have to admit to yourself that it was probably something you’ve done wrong that has left you in this position. And, you have to admit that fixing it will require you to make some emotionally difficult changes. Dr. Phil says, “If you keep on doing what you’ve been doing, you’ll keep on getting what you got”.

by Florian Meyer

Hard as you try, does it feel like your business always has more debt than it can pay off? You’ve spoken to your banker, your family and friends, and no one is able to offer you any financial help. Does the constant debt pressure make you wonder whether it would be better to just throw in the towel and bankrupt the business? No … not yet!!!