Introduction
An incorporated professional who cannot answer basic questions about their own corporation is relying entirely on their CPA to catch every issue — which is a reasonable approach only if the CPA is proactively initiating every relevant conversation. Most are not. The incorporated professional who understands their own corporate position is better equipped to ask the right questions and make informed decisions.
The Ten Questions
1. What is your corporation's fiscal year end?
Not all professional corporations have a December 31 year end. The fiscal year end determines when the T2 is due, when instalments are due, and the timing of compensation decisions. If you do not know your fiscal year end, you cannot plan around it.
2. What was your corporation's net income last year?
Not gross revenue — net income after all deductions. This is the starting point for the corporate tax calculation and the compensation decision.
3. How much did you draw as salary and dividends last year?
These amounts appear on your T4 (salary) and T5 (dividends). If you do not know the split, you cannot assess whether it was optimal for your circumstances.
4. What is your current shareholder loan balance?
Is it zero? Is there an amount outstanding? In which direction — does the corporation owe you money, or do you owe the corporation? An unmonitored shareholder loan balance creates the section 15(2) risk discussed in Article 95.
5. What is your corporation's RDTOH balance?
This figure appears on Schedule 49 of the T2. An RDTOH balance is a future tax refund available when dividends are paid. Not knowing it means you may be deferring a refund unnecessarily.
6. What is your CDA balance?
The capital dividend account tracks the non-taxable portion of capital gains realised inside the corporation. The balance is available for tax-free distributions. If you do not know it exists or what the balance is, you may be drawing taxable dividends when tax-free amounts are available.
7. Is your corporation approaching the passive income threshold?
The $50,000 AAII threshold begins eroding the SBD when exceeded. If your investment portfolio inside the corporation is generating $40,000–$50,000 of annual passive income, the threshold is imminent.
8. When does your corporation need to pay its corporate tax instalments?
Monthly? Quarterly? Based on which calculation method? If you do not know the instalment schedule, you may be incurring avoidable interest as discussed in Article 161.
9. What is your RRSP contribution room for this year?
Available from the prior year's NOA. If you do not know the room available, you may over-contribute (penalty) or under-contribute (leaving tax-free compounding on the table).
10. Has your CPA initiated a year-end planning conversation with you this year?
If you are approaching fiscal year end and have not had this conversation, the window for the compensation decision, equipment timing, and passive income management is closing. The answer to this question determines whether you are receiving planning or just compliance.
Why These Questions Matter
Not because an incorporated professional needs to manage their own taxes — that is the CPA's role. But because an incorporated professional who can engage their CPA in a planning conversation — asking about RDTOH balances and CDA distributions and passive income thresholds — will receive better planning than one who passively receives whatever the CPA provides.