If you're like most Canadians, paying taxes isn't your
favourite aspect of running a business. And paying more than you
have to? No thanks. Fortunately, with the end of 2015 upon
us—and many new tax measures about to take effect in the New
Year—there are some good opportunities for you to reduce the
amount of taxes you pay. Here are a few you should pay particular
attention to:
1. Selecting the right compensation strategy
Bonuses can be a great form of compensation, because they allow
payment to be deferred until after year-end. While you can't
rely on them completely, a compensation strategy that includes a
combination of salary, bonuses and dividends can be a good way for
owners/managers to reduce the income taxes they pay. However, where
income is expected to be over $200,000 in 2016, consider paying
bonuses and dividends before the end of 2015 to avoid a likely
increase in the top rate of tax.
