Feds’ tax change could affect some families earning less than $100K: PBO
OTTAWA — Roughly 900 families earning less than $100,000 a year will have to pay more taxes because of federal changes to tighten income-sharing rules for owners of small businesses, the parliamentary budget watchdog said in an analysis released Thursday.
The report said measures to restrict how much income the higher-earning owners of private corporations can sprinkle to family members, as a way to save on taxes, will cost each of the 900 households an average of $2,200.
About 11 per cent of the 33,000 households affected by the changes earn less than $150,000 a year, while 83 per cent make less than $500,000 a year and two per cent bring in more than $1 million a year, the study said.
The income-sprinkling change was among a handful of measures Ottawa insists will target wealthy people who use corporate structures purely as a way to reduce their taxes.