Simon Williams owns 100 percent of Wonder Technologies Inc. Peter Maximoff owns 100 percent of Speedy Delivery Service Ltd. Simon and Peter each own 50 percent of Scarlet Decorating Ltd. Simon is married to Peter's sister, Wanda. Assuming each of the three corporations is a CCPC and has at least $500,000 of active business income earned in Canada, what is the maximum combined corporate income on which the three corporations can claim the small business deduction?

Question

Quizplus · Accepted Answer

Each CCPC is eligible for the small business deduction on up to $500,000 of active business income. Since each corporation meets this requirement, the maximum combined corporate income on which the three corporations can claim the small business deduction is $1,000,000 (i.e. 3 x $500,000).

Simon Williams Owns 100 Percent of Wonder Technologies Inc