Let’s take a glance at taxes, something that plays a role in all of our lives, but seems to get overlooked by most of us. Which is understandable, when many of us can barely make time for ourselves. The Fraser Institute, an organization based in British Columbia, released a study which stated that Canadians are spending more on taxes than on everyday necessities! Examples of some everyday taxes would be; personal income tax, employment insurance, property tax, sales tax and tax on gasoline as well. Based on the study done by The Fraser Institute, 44% of our income is spent on taxes and we only spend 36% of our income on basic necessities.
Let’s take a look at taxes from another perspective. Close to 50% of the federal government’s revenue comes from personal income tax. While corporation income tax only contributes around 15% of government revenue. The difference is quite substantial.
Based on this difference alone, one can come to the conclusion that corporation can be a beneficial vehicle to lower your taxes. Building a business and investing, can help build your wealth much more tax efficiently. Let’s not overlook taxes anymore, and use our knowledge and understanding of taxes to our benefit!