72  /

Integration—Cost and Benefit of Incorporation 

for Investment Income

B.C.

Alta.

Sask.

Man.

Ont.

Income earned through a corporation

Corporate income

$1,000

$1,000

$1,000

$1,000

$1,000

Corporate tax

 (454)

 (447)

 (467)

 (467)

 (462)

After-tax amount

(A)

 546 

 553 

 533 

 533 

 538 

Dividend refund

4

 267 

 267 

 267 

 267 

 267 

Available for distribution

 813 

 820 

 800 

 800 

 805 

Personal tax of individual

 (274)

 (227)

 (267)

 (313)

 (294)

Net cash to individual

(B)$  539

$  593

$  533

$  487

$  511

Income earned directly by an individual

Personal income

$1,000

$1,000

$1,000

$1,000

$1,000

Personal tax

 (437)

 (390)

 (440)

 (464)

 (495)

Net cash to individual

(C)$  563

$  610

$  560

$  536

$  505

Summary

Tax savings (cost)

of incorporation

1

(B) – (C) $   (24)

$  (17)

$   (27)

$   (49)

$     7

Tax deferral

(pre-payment)

2

(A) – (C)$   (17)

$  (57)

$   (27)

$     (3)

$   33

See the table "Integration—Cost and Benefit of Incorporation" and related notes on the 

following pages.

Current as of September 30, 2013

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affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.