Originally Posted by T.Dot_E30
Stop making up facts and aggregating the truth. CPP is still deducted from your personal income tax, assuming you are claiming the dividends as income otherwise your committing tax fraud. Dividends are after tax dollars from the corporation, meaning they are already taxed albeit at a lower corporate take rate, when you then add in that it is taxed again as your personal income, it starts to equal out.
I'm not saying there is no benefit, I'm saying it isn't as much as you are making it out to be. If the corporation is making lots of money then yes, if it's making pennies or an average salary, then not so much.
Read this from a more creditable source.
First off, I am not making anything up..
Secondly fraud, you are DEAD WRONG if you receive a dividend you do NOT contribute to CPP. There is no fraud in taking a dividend and not paying CPP, its their law! And taking a dividend and not claiming it, of course you claim it that is what we are debating (tax rates of dividends), wtf are you talking about.
And thirdly for the second time in just 3 posts the combination of corporate tax plus dividend tax rate is LOWER let me repeat slowly for you it is LOWER than just taking a salary and being taxed at the highest rate (bracket). There is no equal in the end BS or you tell me what the purpose of a dividend would be than?
I am amazed you quoted a site you didnt even read the first 2 paragraphs of fcp
And I QUOTE from YOUR link, a whole 7 sentences in...
Dividends are investment income – a return on your shares. As such, they are not subject to normal payroll deductions and charges such as CPP and EI premiums, provincial payroll/health taxes, workers’ compensation premiums, etc.
and just below that...
As an added benefit, in many provinces dividends from income taxed at the lowest corporate tax rate results in an all out tax savings of a couple percentage points. When combined with the avoidance of the CPP premiums, the savings can quickly add up, significantly influencing many people’s compensation decision.
Goodnight everyone, Ill be in town all week.