Accountants, financial planners brace for hit from tax changes
Financial professionals are bracing for a drop in revenue if Ottawa goes ahead with proposed tax changes for incorporated small businesses.
If the rules change, accountants and financial planners who prepare the books and invest for these business owners say their clients will be discouraged from using their corporations which, in turn, means less work for those in the industry.
The Liberal government has released draft legislation that would limit business owners’ ability to reduce their family’s tax bill by “sprinkling” income to family members who do not work for the business, as well as the owner’s ability to convert income into capital gains. The government is also proposing to restrict the use of a small business as a vehicle for making passive investments, such as in stocks or private companies, which are unrelated to the operations. (Globe subscribers) Full story