The decisions that actually change the number
Reviewed by EverStone CPA · July 2026
Most of what an owner pays in tax is decided by a handful of choices, not by finding a clever deduction in April. This page lists the ones that recur, gives the short answer to each, and points to the page that works it through properly. Where the honest answer is “it depends,” it says what it depends on.
Quick answer: The four decisions that move the number most: whether to incorporate (worth it once profit is consistently more than you need to live on — the test), how to pay yourself (salary buys RRSP room, dividends skip CPP — the trade-offs), who keeps the books (bookkeeper, accountant or CPA), and whether to change accountants (what it costs and when it is worth it). None of them has a universal right answer, which is why each has its own page.
Decision 1 — incorporate, or stay a sole proprietor
The one most owners think about first and get advice on last. The short version: incorporation starts paying for itself when the business consistently earns more than you need to take out to live on, because only then does the deferral of the small-business rate mean anything. Below that line you are usually paying filing and compliance costs to save nothing. Work it through on should I incorporate, check the timing on when to incorporate, compare the structures on incorporating vs staying a sole proprietor in BC, and put your own numbers into the incorporation break-even calculator.
Decision 2 — how to pay yourself
Salary and dividends are close to a wash on total tax by design; they differ in what else they buy. Salary creates RRSP room and CPP entitlement and costs CPP contributions on both sides. Dividends skip CPP but build no RRSP room. The right mix depends on your income, your family, your province and what you want retirement to look like. Start with salary versus dividends, then RRSP versus dividends for the retirement side, bonus versus dividend at year-end, and salary versus management fee if you run more than one company.
Decision 3 — who keeps the books
Three different jobs get called “the accountant.” A bookkeeper records what happened. An accountant prepares and files from those records. A CPA carries a licence, professional liability and the authority to issue engagements a lender will accept. Most small corporations need the first monthly and the third annually. The differences, plainly, and if the books are already behind, what to do about it or catch-up bookkeeping. If a lender has asked for statements, that is a compilation engagement.
Decision 4 — stay, or change accountants
The usual triggers are silence, surprise invoices and filings that arrive at the deadline rather than before it. Changing is less disruptive than most owners expect: the professional handover is routine and the incoming firm does most of it. What it actually involves is on switching accountants and how to switch. What a first year looks like from this side is on how year one works, and the fee approach is public on pricing.
Decision 5 — employee or contractor
This one is not really yours to decide: the CRA decides it on the facts, and getting it wrong is expensive because the payroll obligations are assessed retroactively with interest. The factors are control, tools, chance of profit and risk of loss, and integration. The factors the CRA applies, the paperwork difference, and what it means for subcontractors. If the answer is employee, the order to do things in.
Decision 6 — what to do with the corporation at the end
Winding up, selling or simply stopping are three different tax outcomes, and the difference between them is often six figures. It is also the decision with the longest lead time: the planning that makes a sale efficient usually has to happen years before the sale. Closing or selling your corporation covers the routes.
The tools, if you would rather see numbers
Some of these decisions answer themselves once the arithmetic is in front of you. The incorporation break-even calculator and the rest of the free calculators use the published rates, so what they produce is the same figure a preparer would start from. Whether it applies to you depends on your year-end and structure — which is what the question box below is for.
Prepared and reviewed by a Chartered Professional Accountant at EverStone CPA, an Abbotsford CPA firm working with small businesses and incorporated owners across the Fraser Valley and Canada. About the firm → · Book a free consult →
Common questions about these decisions
Which of these decisions matters most?+
Can I change my mind later?+
Do I need to decide all of this at once?+
Is there a general right answer to any of them?+
What does it cost to get one of these looked at?+
Stuck on one of these?
Describe the decision in a sentence and a CPA will tell you which way it points for your situation — free, and no obligation.
