Does the strategy of high dividends and low salaries limit our ability to contribute to RRSPs?
Allan Madan, CA
Yes, for two reasons. First, you will have to pay personal income tax on money withdrawn from your corporation to fund the RRSP contributions. Second, I expect your personal income tax to be very low, so the RRSP deduction will not be helpful to you.
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The information provided on this page is intended to provide general information. The information does not take into account your personal situation and is not intended to be used without consultation from accounting and financial professionals. Allan Madan and Madan Chartered Accountant will not be held liable for any problems that arise from the usage of the information provided on this page.
ABOUT THE AUTHOR
ALLAN MADAN
CA.CPA.CGA
Allan Madan is a CPA, CA and the founder of Madan Chartered Accountant Professional Corporation. Allan provides valuable tax planning, accounting and income tax preparation services in the Greater Toronto Area.
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