Tax planning for the shop where the next printer is always on order.

The purchase date is a tax decision

A machine starts earning capital cost allowance only once it is available for use: delivered, installed and able to run. A flatbed that lands in the last month of your fiscal year starts its CCA a full year earlier than one that arrives a month later, on the same cheque. So we plan deliveries against the year-end, not against the sales rep's quarter, and we build the install and commissioning time into the schedule, because a crated machine on the floor deducts nothing.

The temporary immediate-expensing window for small corporations has lapsed, so the write-off now comes from class rates and timing, which our print shop tax filing page sets out machine by machine. Financing belongs in the same decision: interest on an equipment loan is deductible, the 13% HST on the invoice usually comes back as an input tax credit in the same period and can turn the quarter into a refund that helps fund the deposit. One caution we repeat every year: a deduction is a discount, not a rebate. A machine bought only for its write-off still costs most of its price; buy for capacity, then time it for tax.

Owner pay when CCA is doing the heavy lifting

Heavy equipment years crush corporate taxable income, and that changes the salary-and-dividend math. Salary is deductible to the corporation, creates RRSP room and CPP entitlement, and suits years when the shop is otherwise fully inside the roughly 12.2% Ontario small-business band on the first $500,000. Dividends draw on profit already taxed and shine when CCA has already flattened the corporate bill. A year-end bonus is a third lever: deductible when accrued as long as it is paid within 180 days of year-end, which lets a strong year fund a January payment. We set the blend annually, after the CCA schedule is known, never before.

Profit you leave in the corporation is taxed once at the small-business rate and becomes the down payment on the next machine; that retained-earnings engine is the core of the incorporation case, and our sign shop incorporation page makes it in full.

Family, shares and TOSI

Plenty of shops are family operations, and the tax on split income rules decide whose dividends survive. A spouse genuinely working the counter, production or the books an average of 20 hours a week meets the excluded business test, and that protection extends to later years once five prior years of that engagement are banked. Less known: because a print shop earns its income mainly from selling goods rather than services, a family member aged 25 or over holding at least 10 percent of votes and value may fit the excluded shares exception that service businesses are shut out of. The design and install mix can push the service share up, so we test the numbers before any family dividend is declared, not after. Getting this wrong is expensive in a specific way: dividends caught by TOSI are taxed at the top personal rate in the family member's hands, which converts a planning idea into a penalty. Paper the hours, hold the share test to the current year's revenue mix, and the plan survives review.

The exit is a decision you make ten years early

A shop sale usually goes better as a share sale, because the lifetime capital gains exemption can shelter up to $1.25 million of gain per shareholder on qualifying small-business shares. Qualifying is the work: the tests look at what the corporation owns, and surplus cash and passive investments parked next to the presses can taint a company that is otherwise pure. We keep the balance sheet clean as we go, move excess cash out on a plan, and put the whole picture, family shares included, inside Tax Planning & Advisory with Estate Planning covering what happens if the owner is the one thing the shop cannot replace. For a Mississauga shop owner, this is one standing conversation, not five separate scrambles.