Quote:
Originally Posted by blankall
Pretty simple to avoid taxes. Set up a personal corporation. You pay 11-13% tax on the money you keep in the corporation. This rate is lowered with write offs. You can also invest this money into passive investments while in corporate solution, and the profits from these investments are also sheltered.
Structure your finances in a way that any money you take out is minimal, and use write offs for things like home officers, employment use vehicles, business dinners, etc... To keep that tax minimal.
The more you make, the higher proportion of money that stays in corporate solution, and the lower the effective tax rate.
Things like capital gains exemptions, a lack of inheritance tax, trusts, etc. ensure the rich stay rich.
The only real thing the government has done to impede this is getting rid of income splitting.
Edit: disclaimer... Do not do this before talking to a tax lawyer or accountant.
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Yes, but this doesn't avoid tax, it only defers it. Once you take the money out of the corp, in order to have it and spend it personally, you pay the remaining tax.
And for those that aren't familiar with this, corps pay a corporate tax rate, then, when rolled out to personal shareholders, they pay a dividend tax.
corp tax + dividend tax = personal income tax (approximately).
Also, as someone else mentioned, there is no estate tax, however, death is a deemed disposition and capital gains taxes become due (except for the spousal rollover of course, which also is a deferral , not an avoidance).