FOR HIGH-INCOME CANADIAN BUSINESS OWNERS WHO WANT TO...
Your corporation is profitable while hundreds of thousands, or millions in retained earnings, sits in your corporate bank account. Let's take a look at other options. One of them is Corporate Owned Dividend Paying Life Insurance.
Start with the free $1,000,000 Corporate Wealth Test. No form required.
START HERE
Your corporation has excess cash. You need to decide what that money should do next.
THE SOLUTION
Your capital does not have to sit on the books of someone else’s bank any longer.
Ridiculously simple.
The policy is exempt from passive investment income tax rules, hence you keep more.
When you die, tax-free capital dividends can be paid to your surviving shareholders, your heirs.
There is no other asset that insures your family gets more and CRA gets less.
The only loser is Canada Revenue Agency.
NO TURF WAR
We would much rather work alongside them.
The framework
Four stages, in order. Most owners have the first one solved. The other three are where corporate capital quietly wins or quietly leaks.
Your business creates the wealth.
Be deliberate about unnecessary tax friction and where long-term capital lives.
Maintain appropriate access so capital can still be deployed for opportunities, equipment, acquisitions, real estate, business needs, investments and other productive uses.
Be intentional about what ultimately happens to the wealth and how much reaches the family.
Every dollar needs a job. These four stages are how we decide what that job is.
Resource
The Profit Partner mini-course walks through the same capital-allocation thinking in four short parts. It is free, it opens in a new tab, and nothing is gated behind a sales conversation.
Because making corporate wealth and getting corporate wealth to your family are two different problems.
Because this is lived experience as an owner and capital allocator, not a textbook lesson.
Because you don't have to believe a claim. You follow the mechanics.
Because we compare outcomes, not products.
Because the next dollar is already on its way somewhere.
Why this
Corporate investing can absolutely make sense. But investment income earned inside the corporation is taxed each year, and meaningful adjusted aggregate investment income can affect access to the federal small-business limit. The point is not panic. It is knowing what the same dollar is actually doing after tax.
You are still an entrepreneur. Capital may be needed quickly for an acquisition, equipment, real estate, a market opportunity or a business need. Any long-term strategy has to answer one question honestly: what if I need the money?
You spend a lifetime working for it and building it up. The Tax-Man has been waiting with a knife and fork to carve up your lifetime value before your family gets any of it. Retained corporate assets do not automatically become family dollars. Who should end up with more of the money? CRA or the people you love and care about? This asset class, when properly implemented maximizes tax free transfer the way you want not some faceless bureaucrat.
For the right Canadian business owner, the best in class destination for surplus capital is custom designed corporate-owned participating whole life insurance. Why is that...?
What can this particular asset do that your other assets cannot?
Each characteristic depends on policy design, insurability, applicable legislation and the facts of your corporation.
Follow the money
$1,000,000 of long-term corporate capital
Path A
Path B
This is not a claim that one path always wins. Our job is to model both.
Nothing above is a projection. It is a map of where the same dollar can go, and where capital can leave the stream on its way to your family.
Why Ascendant
If you are reading this, you already know the feeling. Your company is profitable, the bills are paid, payroll clears, and still more capital accumulates inside the corporation than the business actually needs.
You ask the same questions I ask. How much stays liquid? What if an opportunity shows up? How do I get this money out without giving away half of it in tax? And how much of what I built will actually reach my family?
I live this. I run a family group of companies valued at more than $100 million. I make payroll. I decide where surplus capital goes. Same decisions you make, often on the same Tuesday morning.
I have used corporate-owned participating whole life insurance as part of my family's financial system since 2008. Today our family banking system holds 78 dividend-paying whole life policies, with more than $53 million in permanent death benefit and over $6.8 million in cash value. We have grown our system so that we now have the privilege to fund $1.569 million a year in premium. I have used this tool to acquire businesses, expand businesses, and hire employees.
I am not sharing this to impress you. I am sharing it so you know I am actually doing what other people might only be talking to you about. I pay the premium. I grow the business. I keep control. That is what every business owner I talk to wants.
That does not mean every dollar belongs in insurance. It does not. I invest in businesses, public markets and private markets, and I deliberately keep liquidity. Different dollars have different jobs. By the time you finish this section, you will already know whether we are the kind of people you want sitting beside you on this part of your balance sheet.
Every dollar needs a job.
Why will it work
Why is it worth it
Pick an annual corporate allocation for the first 5 years. The table updates with an illustrative example over 20 years, using the published assumptions below.
| Category | Cash | Corporate investments | Personal extraction | Par whole life |
|---|---|---|---|---|
| Current use of capital | Sits available in the corporate account | Deployed into corporately held assets | Removed from the corporation and held personally | Funds an exempt policy owned by the corporation |
| Tax implications | Interest taxed annually as investment income | Investment income taxed annually; AAII may affect the small-business limit | Personal tax triggered in the year of extraction | While exempt, accumulation is not taxed annually the same way as ordinary investment income |
| Liquidity | Immediate | Depends on the asset and market conditions | Personal, after tax has been paid | Ready access through policy loans or collateral borrowing, with the owner choosing how the capital is deployed |
| Projected value | ||||
| Estate value | ||||
| Potential CDA | ||||
| Potential family outcome | ||||
| Estimated taxes paid over the modelled period |
Illustrative example only. These are not a policy illustration, tax opinion, or projection of your results. These are educational, illustration derived estimates. They do not replace a carrier approved illustration. Participating whole life includes values that are not guaranteed, and actual carrier illustrations will differ and must be used for any real recommendation. Full comparisons require modelling of your corporation, with your accountant and legal advisor involved.
Great question. I do.
This was never "insurance versus investing." Different capital has different jobs. The honest comparison is across characteristics: volatility, liquidity, tax treatment, estate characteristics, guarantees and risk, for the specific job that specific dollar has to do.
Why now
Another $300,000 of surplus will show up whether or not it has a job. It will end up somewhere, by design or by default.
Whether it is intentional or not, you are deciding where this money goes.
One practical note, stated plainly: age, health and insurability cannot be purchased retroactively. That is simply how underwriting works, and it is not a reason to rush. There are no countdowns here and no "spots left." A good decision made carefully beats a fast one.
Compare outcomes, not products.
Run the numbers yourself first. If there is nothing worth changing, we will tell you.
When you want a person in the room, there are two ways in.
