Tue Oct 17, 2017
Canadian Prime Minister Justin Trudeau has announced that the Federal Government will cut the small business tax rate from 10.5 percent to 9 percent starting Jan. 1, 2019.
This announcement follows the recent backlash the Liberal Government received from its tax planning proposal earlier this summer and is aimed at resolving criticisms that the proposed changes would hurt the middle-class and small business owners across the country.
In regards to the recent tax planning consultations, which the RVDA of Canada participated in – read the full submission here - the Government has also announced that it no longer intends to change the lifetime capital gains exemption rules. It will however end income sprinkling for family members who do not make contributions to family businesses, effective Jan. 1, 2018. This new definition of ‘reasonable contribution’ states that such a contribution must include either labor, capital, taking on a financial risk such as co-signing a loan or past contributions along those lines.
RVDA has been advocating strongly to ensure that the voice of small-businesses is heard in this process and will continue to do so, according to a press release.