The Saskatchewan government introduced legislation yesterday to reduce its Small Business Corporate Tax Rate to 0% effective October 1, 2020. The tax rate will increase to 1% effective July 1, 2022, and then back to 2% effective July 1, 2023. The reduced rate will apply to up to $600,000 of taxable income per year in Saskatchewan, and be pro-rated for taxation years that include periods with different tax rates. This reduction only applies to Saskatchewan provincial tax, the Federal small business tax rate (currently 9% for all periods mentioned above) will still apply to taxable corporate income.
The government estimates an average savings of $6,100 to over 31,000 incorporated Saskatchewan small business corporations, with a maximum savings of $27,000 per corporation. No special applications or elections will be necessary to access the reduced tax rates.
Please contact your Virtus Group advisor or fill out the form below with have any questions you may have.