Business owners · Physicians & dentists
Incorporated physicians and dentists
A professional corporation often builds surplus faster than anything else in your financial life. The planning questions are about how that surplus is held, what happens to the practice if you cannot work, and how the value reaches your family.
The planning issues
What usually matters for physicians & dentists
Not every issue applies to every owner. These are the questions we most often help owners work through, with your accountant and lawyer leading on tax and legal design.
Surplus that keeps growing inside the corporation
Investment income inside a professional corporation is taxed at about 50% in Ontario (part of it refundable when dividends are paid). Once it passes $50,000 a year, it starts to reduce the small business limit on practice income.
Check the passive income costWho can own shares, and income splitting
In Ontario, voting shares of a physician or dentist professional corporation must be owned by members of the college. Non-voting shares may also be held by a spouse, child or parent of a voting shareholder, or in trust for minor children. Dividends paid to family members can be taxed at the top rate under the tax on split income (TOSI) rules, and the “excluded shares” exception is not available to professional corporations. Your accountant and lawyer confirm what applies to you.
Practice continuity if you cannot work
If you are off for months, overhead such as staff, rent and equipment leases usually continues. Disability and overhead expense coverage are protection questions to compare with your cash reserves.
Check practice exposureEstate liquidity
At death, your professional corporation shares are generally treated as sold at fair market value. The estate needs cash for that tax, any registered-plan tax and Ontario Estate Administration Tax.
Check estate liquidityPractice sale or transition
A future sale, associate buy-in or wind-down changes what the corporation holds and when. Planning works best several years ahead.
Where to start
Planning checks for this situation
Each check shows any estimated funding gap under assumptions you can see and change. Nothing you enter leaves your browser.
Planning check
Passive income cost
What annual tax on investment income and the small business limit grind cost surplus held in your corporation.
Open the checkPlanning check
Key-person exposure
The cost to the business if a key person is gone, versus reserves, credit and existing coverage.
Open the checkPlanning check
Estate liquidity
What your estate would need to pay at death, minus the cash and coverage already available.
Open the checkHow we help
What a review can do
Insurance is one of the options we compare across multiple companies. Insurance advice and applications for Ontario residents are handled by Jackson Armstrong, Financial Consultant, LLQP. When a gap is better closed another way, or an estimate shows none, we say so.
Sources reviewed November 7, 2026: O. Reg. 665/05, Health Profession Corporations; CRA, Tax on split income: excluded shares. General summary only; rules have exceptions.
- Sort the corporation’s money into what the practice needs accessible and what is genuinely long-term.
- Compare disability and overhead coverage options across several insurers against what your reserves already cover.
- Estimate estate liquidity with you and your accountant, then compare insurance and non-insurance ways to cover any gap.
Next step
Book a no-cost business-owner review
About 20 minutes. We look at what your corporation should keep accessible, what it should protect, and how the value you have built transfers. No recommendation until we understand the facts, and no obligation.