Canada Revenue Quebec Announces Increased Small Business Deduction Rate

The Canadian Revenue Quebec May 4 announced an increase to 9.3 percent, from 8.3 percent, in the small business deduction (SBD) rate for Canadian-controlled private corporations (CCPCs). The announcement clarifies that: 1) the SBD allows certain CCPCs to apply a reduced tax rate to the first C$500,000 (US$367,113) of annual taxable income from qualifying domestic business activities; 2) that the C$500,000 threshold is gradually reduced for CCPCs with paid-up capital (PUC) between C$10 million (US$7.3 million) and C$50 million (US$36.7 million), and adjusted aggregate investment income (AAII) between C$50,000 (US$36,665) and C$150,000 (US$110,134); 3) the SBD doesn’t apply to CCPCs ...