How to Pay Yourself from Your Corporation

A Quick Checklist for Shareholders

You’ve built something great—now let’s make sure you’re paying yourself in the smartest, most tax-efficient way possible. Here are your main options to withdraw funds from your corporation, each with its own perks.

1. Take a Salary or Wage

✔️ Steady income
✔️ Builds RRSP room
✔️ Boosts CPP benefits
✔️ Reduces your corporation’s taxable income

Best for you if:

  • You want regular income

  • You’re planning for retirement

  • You want to qualify for RRSPs and other credits

2. Take Dividends

✔️ Often taxed at lower rates
✔️ No CPP contributions required
✔️ Flexible timing and amounts

Best for you if:

  • You prefer flexibility

  • You want to top up income in a tax-smart way

3. Use a Shareholder Loan

✔️ Quick access to funds
✔️ No tax if repaid within the right timeframe
✔️ Great for short-term needs

Best for you if:

  • You need short-term cash

  • You have a plan to repay the loan within one year

4. Return of Capital

✔️ Can be withdrawn tax-free (up to your investment amount)
✔️ Defers taxes to the future

Best for you if:

  • You want to lower taxes today

  • You’re okay deferring taxes to a later time

5. Charge Management or Consulting Fees

✔️ May allow for income splitting or tax deferral
✔️ Tax-deductible to the corporation

Best for you if:

  • You operate through another entity (like a consulting company)

  • You want to explore advanced tax planning strategies

Let’s Create Your Custom Pay Strategy

The best option depends on your goals, lifestyle, and tax situation—and we’re here to help you find the perfect mix.

Ready to make a plan?

Book a call with us at EO CPA and let’s design a pay structure that works for you.