The Corporate Year-End Planning Checklist

The Corporate Year-End Planning Checklist: Do These Before Your Fiscal Year Closes

The short answer: almost every meaningful corporate tax strategy has the same expiry date: your fiscal year-end. After it, your accountant isn't planning anymore; they're reporting history. This is the checklist we run with Silverline's corporate clients across Surrey, Vancouver, Langley, and Delta about eight weeks before each client's year-end. If your current accountant has never called you in the fall, this post is what that call should contain.

1. Set your remuneration mix deliberately

The salary-versus-dividend decision (our full guide covers the trade-offs) has to be executed before year-end: salary must actually run through payroll in the year, and a bonus accrued at year-end must generally be paid within 180 days to keep the corporate deduction. Decide the mix based on this year's corporate income, your cash needs, RRSP room goals, and next year's expectations, on paper, on purpose.

2. Time your equipment and asset purchases

If the business genuinely needs equipment, vehicles, or technology soon, buying before year-end starts depreciation deductions a full year earlier than buying a month later. The discipline: never buy things you don't need "for the write-off". A deduction refunds only a fraction of what you spend, but always time things you do need with the year-end in mind.

3. Review shareholder loan balances

If you've drawn corporate money informally during the year, year-end is when the clock matters: balances left outstanding too long can be added to your personal income in full. This is one of the ugliest results in Canadian tax. Clean it up now with proper salary, dividends, or repayment, not at filing time when options have expired.

4. Harvest investment losses (and mind the corporate accounts)

Corporations with investment portfolios can realize losses to offset gains, and dividend payments interact with the corporation's notional tax accounts. Sometimes paying a dividend recovers refundable corporate tax. This is technical, high-value, and precisely the kind of planning that only happens when someone looks before December 31.

5. Check the passive income position

Corporate investment income above $50,000 per year starts grinding away your access to the low small-business tax rate. If your corporation's portfolio has grown, a good problem common among our incorporated physician and dentist clients, year-end is when to review asset location, corporate-owned insurance strategies, and whether an Individual Pension Plan has become worthwhile.

6. Pay working family members properly

Reasonable salaries to family who genuinely work in the business must actually be paid and papered in the year. (Dividends to non-working family are a TOSI trap — see our TOSI guide.)

7. Make corporate donations and prepay smartly

Charitable donations deduct in the year they're made. Certain expenses coming due early next year can sometimes be reasonably accelerated. Small levers, real money.

8. Confirm instalments and avoid interest

Check corporate tax instalments against this year's actual income trajectory. Catching a shortfall in month eleven costs far less than discovering it with your T2.

9. Look one year ahead

Year-end is also when to ask the structural questions: is it time for a holding company, a family trust with a real purpose, a fiscal year-end change, or sale-readiness planning? None of these are filing-season conversations.

Silverline builds every corporate client a one-page year-end plan each fall: the mix, the payments, the deadlines, the instalments. If you've never had that conversation, book a free consultation before your year-end, and see what proactive actually looks like.

General information; several items above have technical conditions — execute with advice, not from a checklist alone.

FAQ

My year-end is December 31 and it's mid-December. Too late? Not for most of the list: remuneration, purchases, donations, and loss harvesting can still happen. Book the conversation this week, not in January.

Can I just decide my salary/dividend split when we file? Dividends have some retroactive flexibility; salary and bonuses largely don't. Deciding at filing time means the best mix was probably unavailable.

How do I know if the passive income grind affects me? If your corporation's investments earn anywhere near $50,000 a year, roughly a $1M portfolio at typical yield, you're in the zone and should be planning around it.