Tax Residency In Australia VS. Canada (online small business)

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320 viewsMay 27, 2024

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Anonymous Posted May 22, 2024

Hi there,
I am currently living between Canada and Australia. I do not have property in either country at the moment, but I’m looking to get property in both countries in the future.
I’m an online business owner and currently pay taxes to both Canada and Australia. Which country makes more sense to set-up my business in for taxation purposes?
I work with clients in both countries, so I wasn’t sure if I can choose my tax residency based on being a Canadian citizen and having an Australian partner visa. Any suggestions on how to get support in this area is appreciated, thanks

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score 0 · Answer 1 · 2024-05-27T13:53:51+00:00

Hi Stephanie,

The corporate tax rate for Australian small businesses is 25%. A small business is a business with annual sales of less than $50 million AUD. The corporate tax rate for Canadian small businesses is 12%. A small business is a business controlled by Canadian residents with active net income of less than $500,000 CAD in the year. Active net income in excess of $500,000 CAD in the year is taxed at 26%.

Therefore, Canada is the better country from a tax perspective for small businesses with net active income of less than $500,000 CAD per year.

Tax Residency In Australia VS. Canada (online small business)

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