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03-15-2013, 01:35 PM
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#1
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HELP ME PLS!!!
Join Date: Oct 2005
Location: Death Star
Posts: 5,707
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Small business owner (salary/dividend)
I know there are some working in the accounting field on here.
I'm familiar with the procedures with paying a salary, however cloudy in terms of dividends.
How does a small business declare dividend to its owner?
just write a cheque? I believe there is T5's to issue out
also if there are 2 shareholders, how do you just pay one of them?
any help would be appreciated.
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Last edited by sexyaccord on 69-69-6969 at 69:69 PM
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03-15-2013, 04:14 PM
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#2
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Willing to sell body for a few minutes on RS
Join Date: Feb 2002
Location: Richmond
Posts: 11,187
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How to Pay Yourself - Corporation - Wizebiz | Wizebiz
If you issue 2 different classes of shares between the two of you, you can issue dividends on only one of those shares and thus only pay one person
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03-15-2013, 04:23 PM
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#3
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I contribute to threads in the offtopic forum
Join Date: Jun 2006
Location: not vancouver
Posts: 2,642
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above says it all
you will need a and b shares - same vote, but you can pay out as you like - but get a shareholder's agreement.
div are better than salary, no EI and CPP - although, no RRSP and no earned income (of sorts - i'm not sure how mortgage ppl see this, whether they disregard dividends as 'investment income' or whether they realize it's earned... but that's a different story)
i personally don't like RRSP's as investment vehicles, max ur TFSA's, first always, forget RRSP, enjoy getting more at the end of the day
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03-15-2013, 08:17 PM
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#4
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WOAH! i think Vtec just kicked in!
Join Date: May 2005
Location: vancouver
Posts: 1,620
Thanked 218 Times in 59 Posts
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Me and my business partner pay ourselves in dividends. Especially in our first year because we were just withdrawing from our loan accounts so we did not pay any personal taxes.
I just met with my bank lady and she said that if we are paying ourselves in dividends and granted we did not show any income, when it comes to mortgages they take this all into account.
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