Free tool · Decisions

Sole Proprietorship vs Corporation Calculator

Compare estimated take-home income, tax, and CPP as a sole proprietor versus a corporation in Canada, and get a recommendation.

Compare the two structures

Expected annual net business income (before tax)

Province or territory

Do you need the income personally this year?

Amount you would leave in a corporation each year

Assumptions — edit these if you have better numbers for your situation.

Combined corporate tax rate on business income (%)

Approximate personal tax on dividends taken out (%)

How this is estimated: sole-proprietor figures apply 2025 federal brackets, one approximate provincial rate and self-employed CPP (11.9% of contributory earnings up to the $71,300 YMPE, plus 8% to the $81,200 YAMPE); the corporation is taxed at the combined small-business rate you enter, then dividends are taxed at the approximate personal rate you enter, with no CPP on dividends. Estimates only, as of 2025/2026 — confirm current rates on canada.ca and with a CPA before deciding.

Sources: Canada Revenue Agency — income tax rates for individuals · CRA — CPP contribution rates, maximums and exemptions · CRA — corporation tax rates

Compare the two structures

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