Exempt Spouses from Tax on Split Income

Allowing Canadian-controlled private corporations (CCPC’s) to split income would create consistency within the treatment of income taxes. It would also support the success and enhance the growth of small businesses, especially family-based businesses. 

Historically, owners of Canadian-controlled private corporations (CCPC’s) have been able to split income with family members by paying dividends on CCPC shares owned directly, or indirectly through a Family Trust, to family members including spouses and children.

Up until 2000, this strategy was available to small business owners with respect to the payment of dividends to all family members including minor children1, most often via the use of a Family Trust.