You’ve built your wealth through years of hard work, long hours, and sacrifice. Your corporation is not just a business entity—it’s your retirement plan, your safety net, and your family’s future.
But what if nearly 70% of that wealth disappears to taxes the moment you pass away?
For many Canadian business owners, physicians, and professionals, that’s not a possibility—it’s the reality without professional estate planning.
At Bison CPA LLP, we call this the silent generational wealth killer.
The $10 Million Example That Shocks Every Business Owner
Picture this scenario:
- A professional owns a corporation holding $10 million in cash and investments.
- While alive, the money sits safely in the corporation, with no immediate tax liability.
- But at death, the tax rules change everything.
First Hit: Deemed disposal gain of Shares
At the time of death, Canadian tax law assumes that you’ve sold all your assets, including your corporate shares, at fair market value. This “deemed disposition” creates an immediate capital gains tax bill of about $2.4 million.
Second Hit: Extracting the Cash
Now your heirs inherit the corporation, but the money is still locked inside. To use it, they need to take dividends, which trigger another $4.6 million in dividend tax.
Final Outcome: A Crushing Loss
- Original value: $10,000,000
- Total taxes paid: $7,000,000
- Actual inheritance: $3,000,000
Almost 70% of your life’s work is gone.
Why Traditional Estate Planning Isn’t Enough
Most people assume that writing a will, designating beneficiaries, or even setting up basic trusts counts as estate planning. The truth? That’s not estate planning—it’s just estate distribution.
Without integrating tax and corporate planning into the process, “estate planning” often kills wealth instead of protecting it.
- Corporate wealth is taxed differently than personal assets.
- The same pool of money is taxed multiple times.
- Your heirs inherit the liability, not the legacy.
This is why wealthy families often lose fortunes within a single generation: they mistake paperwork for strategy.
The Psychology of Wealth Transfer
The numbers tell one part of the story, but the emotional cost is just as significant:
- Families expect stability but face financial strain. Heirs are shocked to learn that what looked like millions is suddenly reduced to a fraction.
- Businesses are forced to liquidate. Without planning, heirs may need to sell assets or even the business itself just to pay taxes.
- Legacies vanish. Generational wealth is meant to empower children and grandchildren—but poor planning transfers it to the government instead.
The Professional Estate Planning Advantage
Fortunately, this isn’t inevitable. With professional guidance, the tax burden can be reduced dramatically—sometimes to a fraction of the original amount.
Here are proven strategies we implement for clients:
- Pipeline Planning – Allows corporate cash to flow to heirs as a capital gain rather than as taxable dividends, avoiding the second layer of tax.
- Estate Freezes – Locks in today’s share value for tax purposes, transferring future growth to heirs.
- Capital Dividend Accounts (CDA) – Creates opportunities for tax-free payouts, particularly when combined with life insurance.
- Life Insurance Planning – Ensures liquidity to pay taxes, preventing forced asset sales.
- Holding Companies & Family Trusts – Provide flexibility, control, and protection in intergenerational wealth transfer.
With the right planning, that same $10 million estate could pass to the next generation with $8–9 million intact, instead of just $3 million.
Bison CPA LLP – Protecting Generational Wealth
At Bison CPA LLP, we specialize in advanced tax and estate planning for professionals, physicians, dentists, and business owners. We go beyond basic estate documents, integrating tax law, corporate structuring, and wealth preservation into a unified plan.
Our approach is designed to:
Minimize double taxation
Protect intergenerational wealth
Ensure smooth succession
Safeguard your legacy for future generations
Without Planning: $10M → $3M (70% lost)
With Planning: $10M → $9M (90% preserved)
Without professional estate planning, $10 million can shrink to $3 million. With the right plan, most of that wealth can be preserved.
Contact Bison CPA LLP today to transform your estate plan from a wealth killer into a wealth protector.