Sep 21, 2017 – The big disadvantage to paying yourself a salary from your corporation is that you will have a personal income. Salary is one hundred percent taxable (unlike dividends, which are taxed at a lower rate) so it's possible that paying yourself a salary could increase your tax load.

May 26, 2017 – Chart 2: Personal taxes (2017 rates) Since Roberto owns an Ontario corporation, the first $500,000 of active business income is taxed at 15% (combined federal and provincial). His salary, the employer CPP contribution and EI premium are deducted from the corporation's income, leaving it with taxable income of $140,965.

Salary vs. dividends. … The eligible dividend regime also means that it's no longer a rule of thumb to bonus down to the small business limit. Tax tip: Consider paying yourself a salary large enough to make maximum CPP and RRSP contributions.

If you own a Canadian small business corporation, you have to figure out whether you want to pay yourself a salary income or dividends – or both. The correct decision for you will come down to personal circumstances, but you should have an objective understanding of the advantages and disadvantages of each payment …

DIVIDENDS vs. SALARY for Small Business Owners in CANADA. One of the common dilemmas the small business owner is facing when the tax season approaches, is whether to get paid by dividends, or by payroll, putting on the scale total money outcome for both the individual, and the corporation. Many of us have heard …