How to claim money lent to your own corporation in canada, ontario

Question

2630 viewsApril 4, 2019Business Tax

0

Jeff (anonymous) Posted April 3, 2019

Hello, I am filling my personal taxes as well as my corporation taxes. Let me give you a scenario.

I personally have 1000$ and I transfer this money as a loan to my own corporation. Then my corporation spent 500$ on business-related purchases. Now my company has 500$ and I have 0$

The loan is meant to be paid at some point but not this year.

How do claim that I lent money to my corporation on my personal income tax return?
How do I claim this loan on my business income tax? Is it technically income? Thanks

1 Answer

score 0 · Answer 1 · 2019-04-04T20:08:18+00:00

Do not report shareholder loans made by you to your corporation on your personal tax return. In your example, the corporation owes you $500. This is not income, but is a shareholder loan payable. When the company has available cash, it can pay you back the remaining balance ($500) tax-free. Note that shareholder loans should be reported on Schedule 11 of the T2 Corporate Tax Return.

How to claim money lent to your own corporation in canada, ontario

1 Answer

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