Business Impact on Passive Investments
Passive investment income tax changes apply to the wealthiest 3% of corporations Morneau says. 1
The small business lower tax rate is to be incrementally reduced for corporations that earn more than $50,000 in an annual income from passive investments. Over $150,000 or more earnings will lose eligibility for the small business deduction.
Additionally proposed is that corporations will no longer get a refund on taxes paid on investment income distributed through dividends.