39 What are the similarities and differences between the various types of corporations (private, CCPC, public). (6.2.1)
Jessica Thao
The status of a corporation whether it’s private, public, or a canadian-controlled private corporation (CCPC) will affect the tax treatment of its shareholders and the corporation itself. The similarities and differences are shown below:
|
|
CCPC |
Other Private corporation |
Public corporation |
|
Definition |
|
|
|
|
Net tax rate (corporate tax rates) |
|
15% |
15% |
|
Eligible for RDTOH |
Yes (CRA ‘refundable dividend tax on hand) |
No |
|
|
Additional refundable tax |
Yes, on passive income |
No |
No |
|
Small business deduction |
Yes, for ABI up to the $500K SBD threshold. | No |
No |
|
Other tax benefit |
– Enhanced investment tax credits – Capital gain exemption for shareholders on the sale of shares – Research & development tax credit |
No |
No |
Interactive content (Author: Emily Yeung, January 2020)
References and Resources:
- Article – “Small business deduction rules” (Author: Goverment of Canada)
- Article “T2 corporation income tax guide chaoter 6″ (Author: Government of Canada)
- Article “Corporations” (Author: Government of Canada)
January 2020
