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Management Fee to my Wife company Tax

Tax QuestionsCategory: FeaturedManagement Fee to my Wife company Tax
Shelly Harris asked 1 month ago

I want to split income with my spouse. Can I give a management fee to her company?

1 Answers
GTA Accounting Staff answered 1 month ago

Income splitting has become very tricky. By giving management fee to your spouse company, you will make both the companies associated and they have to share the small business deduction. If the net income of both the companies is less than $500,000 then you are fine in giving the management fee to your spouse company.

Based on the final scenario, remember to report association on S23 and  management fee on S14. You might have to report Specified Corporation Income on S7.

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