The use of a corporation is most likely to result in a reduction in total taxes if:
A)The corporation is a public company earning manufacturing income.
B)The corporation is a CCPC earning dividends.
C)The corporation is a CCPC earning investment income.
D)The corporation is a CCPC earning active business income.

Question

Quizplus · Accepted Answer

CCPCs (Canadian-controlled private corporations) earning active business income are eligible for the small business tax deduction, meaning they are taxed at a lower rate than other corporations. This can result in a significant reduction in total taxes. Public companies and CCPCs earning investment or dividend income do not qualify for this deduction and may not see a reduction in total taxes.

The Use of a Corporation Is Most Likely to Result