Ready for the shareholder

Un prêt à l'actionnaire, c'est de l'argent qu'un propriétaire (actionnaire) retire de sa société sans le déclarer comme salaire ni comme dividende (part de profits). S'il ne le remet pas à temps, l'Agence du revenu du Canada (ARC) et Revenu Québec l'ajoutent à son revenu imposable, avec un intérêt à déclarer en plus.

Brief

Withdrawing money from your company creates a debt: you must repay it.
Repayment deadline: before the end of the financial year (the "financial year") following the year of withdrawal
If not repaid on time: the full amount is added to your personal taxable income, all at once.
Interest calculated at the "prescribed rate" (a rate set by the government) must also be declared.

Why does this matter?

This is one of the most common pitfalls for incorporated entrepreneurs. For example, you withdraw $15,000 from the company account to renovate your kitchen, thinking you'll "pay it back later." If the balance isn't repaid within the agreed timeframe, that $15,000 is immediately added to your personal taxable income, with no deduction for the company. These back-and-forth transactions (repaying and then immediately withdrawing more money) are also monitored and rejected. Rigorous monthly tracking of your account prevents unexpected bills. Bankeo connects you with a free, audited accountant/CPA who assists incorporated entrepreneurs with this type of monitoring, and we'll be there to support you every step of the way.

Frequently asked questions

What exactly is a shareholder loan?

This is money that you, the owner, take out of your company without declaring it as salary or dividends (profit share). From the tax authorities' perspective, the company has "lent" you this money: you must therefore return it, otherwise it becomes taxable income for you.

What is the repayment period?

You must repay no later than one year after the end of the fiscal year (the financial year) of the company in which the loan was made. For example, a withdrawal made during the fiscal year ending December 31, 2025, must be repaid before December 31, 2026, to avoid it being added to your income.

How can this problem be avoided?

By planning your withdrawals in advance—salary, dividends, or repayment of your own investment in the company—each has its own impact. Having an accountant who monitors your advances throughout the year helps you avoid unpleasant surprises at the end of the fiscal year. Bankeo provides you with a free, audited accountant/CPA who supports incorporated entrepreneurs with this monitoring, and we remain by your side every step of the way.