CPA for Investment Companies in Ontario: Protect the Small Business Deduction and Recover Every Refundable Dollar
We handle your OSC and CRA obligations, RDTOH tracking and adjusted cost base, so your investment corporation keeps what it earns. From holding companies and mortgage investment corporations to registered portfolio managers and family offices, we keep your records broker-accurate, your refundable tax accounts tracked, and your T2 filed on time — with AFFORDABLE flat fees and no year-end surprises.
AFFORDABLE Investment Company Tax Accountant
Running an investment corporation is not the same as running an operating business. The tax sits in refundable accounts, the deductions sit in the adjusted cost base, and the mistakes sit quietly for years until CRA finds them. Gondaliya CPA provides investment company accounting services built for how these corporations actually work, and we act as your investment holding company accountant year-round rather than once a year.
We work with holding companies, mortgage investment corporations, registered portfolio managers and family offices across Ontario. Our investment company tax planning covers the passive income grind, the refundable dividend tax accounts and the capital dividend account, and as your portfolio company accountant we handle accounting and bookkeeping for investment companies from the broker statement forward. Investment holding company bookkeeping is done monthly, not reconstructed in April.
Our Official Partners
Investment Corporations We Understand
Passive-income corporations are all we do at this level. From your brokerage statements to your year-end T2, we track adjusted cost base, reconcile every T5 and T3 slip, and keep your RDTOH and capital dividend account accurate so refundable tax and tax-free capital dividends are never left on the table. One team, clear fixed fees, no surprises.
The Problems Investment Corporations Bring Us
The passive income grind
Once aggregate investment income passes the $50,000 passive investment income threshold, your operating company starts losing the Small Business Deduction. Most owners find out a year late.
The 50.17% problem
Investment income inside a corporation is taxed at the 50.17% Ontario investment income rate before any refund. Without a dividend plan, that money stays with CRA.
Nobody computes Schedule 7
Schedule 7 aggregate investment income drives the grind, the refundable tax and the dividend refund. If it is wrong, every other number on the T2 is wrong.
Books that never tie to the broker
An unrealized gain adjustment posted once a year is not bookkeeping. When the statements do not tie to the broker, the audit becomes expensive.
Stay Compliant and Minimize Your Investment Company Tax
For a passive-income corporation, compliance and tax recovery go hand in hand. We keep every CRA obligation on schedule while tracking the refundable-tax and integration mechanics that put cash back in the company.
Accounting & Tax Experts for Investment Companies
- AFFORDABLE + Fully Registered CPA Firm
- Business and Corporate Tax Expert
- Small and Medium Business Expert
- Accounting, bookkeeping, and tax filing
- Certified CPA (Canada and USA)
- 1300+ 5-star Google reviews
- 30-Day Money-Back Guarantee
- 60-Day Fees-Matching Policy
- Records prepared to support CIRO member reporting where applicable
Why Choose Our Tax and Accounting Service for Investment Companies
Investment corporation expertise
We understand management fee revenue recognition, refundable tax accounts and the difference between a holding company and a specified investment business.
Bookkeeping that ties to the broker
We maintain an adjusted cost base schedule per security and reconcile to the custodian every month, not once a year.
Registrant-ready reporting
We prepare the trial balance and working papers behind OSC annual audited financial statements so the auditor is not waiting on you.
Reporting you can use
Where Croesus portfolio reporting or a similar system is in place, we tie the ledger to it so performance and tax numbers finally agree.
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Holding & Investment Corps
Investment Company Tax and Accounting Services in Ontario
Corporate Tax Filing for Investment Companies
T2 tax preparation and filing for investment corporations, with Part IV tax, refundable accounts and dispositions handled correctly.
Accounting & Bookkeeping for Investment Companies
Monthly reconciliation to broker and custodian records, with financial statements and reporting.
Corporate Tax Planning for Investment Companies
Passive income planning, dividend timing, capital dividend account and holding company structure.
Catch-Up Corporate Tax Filing for Investment Companies
Unfiled T2 years rebuilt from broker records, penalty relief requested, compliance restored.
GST/HST Filing for Investment Companies
Taxable fees separated from exempt financial services, input tax credits allocated defensibly.
Corporate Tax Cleanup for Investment Companies
Prior-year errors on ACB, shareholder loans and refundable accounts corrected by amended return.
CRA Audit Resolution Services for Investment Companies
Representation on trading character, foreign reporting, shareholder loans and withholding.
CPA Compilation Report (Notice to Reader) for Investment Companies
CSRS 4200 statements for lenders, custodians and registrants.
Incorporation Services for Investment Companies
Share structure, registrations, MIC set-up and account opening handled together. Incorporation services for investment corporations.
Accounting & Tax Services Tailored for Investment Companies
Real, practitioner-level CPA expertise for holding companies, mortgage investment corporations, portfolio managers and family offices across Ontario — built for how investment corporations actually operate.
- We report portfolio dividends received from non-connected Canadian corporations on Schedule 3 of your T2, where CRA applies 38 1/3% Part IV tax that is refunded only when your investment corporation actually pays a taxable dividend out.
- We report every disposition on Schedule 6 with per-security adjusted cost base rather than the gross proceeds shown on the broker’s T5008, because CRA reassesses investment corporations that report proceeds with no proven cost behind them.
- We maintain the general rate income pool on Schedule 53 so eligible dividends are designated correctly, because an over-designation triggers Part III.1 tax at 20% of the excess and CRA assesses the corporation, not the previous accountant.
- We track the eligible refundable dividend tax on hand account separately from the non-eligible pool on your T2, because paying the wrong dividend class recovers nothing and leaves refundable tax sitting with CRA for another full year.
- We reconcile your Interactive Brokers and Wealthsimple corporate statements to every T5, T3 and T5008 slip before the T2 is filed, so CRA’s automated slip matching does not flag your investment corporation for review.
- We post every trade from your Interactive Brokers activity statement with trade date, settlement date, commission and exchange rate, so realized gains tie to the broker’s records and CRA sees no unexplained difference at year-end.
- We maintain adjusted cost base per security in Sharesight and carry it into the ledger under ITA section 53, because return-of-capital distributions from ETFs quietly reduce ACB and an untracked base overstates every future capital gain.
- We open separate ledger accounts for portfolio dividend income, corporate interest income, realized gains and management fees, so Schedule 7 aggregate investment income is computed from the books rather than rebuilt from broker statements, and CRA has a clean trail.
- We book foreign holdings at the Bank of Canada daily rate on trade date with a separate foreign exchange gain account, so your T1135 cost amounts and Schedule 6 gains agree instead of contradicting each other in a CRA review.
- We configure Xero with a tracking category for each mandate, so management fee revenue, custodian fees and brokerage commissions report by mandate and map straight to GIFI codes on the T2 without a year-end spreadsheet rebuild.
- We monitor passive income on Schedule 7 against CRA’s $50,000 threshold, because every dollar above it grinds $5 of the $500,000 Small Business Deduction and eliminates it entirely once aggregate investment income reaches $150,000.
- We time dividends so the 38.33% dividend refund is triggered in the same year the NERDTOH balance arises, rather than leaving your money with CRA while the shareholder waits for a distribution nobody planned.
- We plan around the 38 1/3% Part IV tax on portfolio dividends by matching dividend receipts to dividend payments within the same fiscal year, so refundable tax does not sit dormant with CRA on the T2 for three years.
- Where an operating company sits beside the portfolio, we move retained earnings up by intercorporate dividend under ITA section 112, confirming connected status so no Part IV tax applies and the $1.25M Lifetime Capital Gains Exemption stays available.
- We roll securities held personally into the investment corporation under an ITA section 85 election at elected amounts, deferring realized capital gains that would otherwise be taxed at 26.76% in your hands in the year of transfer.
- We rebuild unfiled years from your Questrade trade log export, custodian reports and bank records, so every disposition, dividend and interest receipt is captured on the catch-up T2 instead of estimated and later reassessed by CRA.
- We reconstruct the NERDTOH, ERDTOH and capital dividend account balances for every unfiled year, because CRA will not process a dividend refund or a T2054 election on a balance that was never carried forward.
- Where foreign property was never reported, we file under CRA’s Voluntary Disclosures Program before an assessment issues, because the T1135 penalty runs $25 per day to $2,500 for each year left outstanding.
- We test each unfiled year against the $100,000 cost threshold for specified foreign property, because a US brokerage account crossing that line in a single year creates a T1135 obligation most corporate owners never knew existed.
- We match reconstructed years against the T5, T3 and T5013 slips already on file with CRA, so the catch-up T2 reports every interest and dividend receipt the agency can already see on its own system.
- HST registration is triggered once taxable management, advisory and referral fee income passes $30,000 over four consecutive quarters, so we identify the exact quarter before CRA assesses tax you never collected from the payer.
- We claim input tax credits only on the taxable share of overhead — fund administration fees, portfolio software and professional fees — using an allocation method under section 141.01 of the Excise Tax Act that survives a CRA review.
- A corporation that is a financial institution with revenue over $1,000,000 files the GST111 annual information return six months after year-end, and CRA assesses a separate penalty on that return even when the HST return was filed on time.
- Trailer commission income earned for distributing funds is generally an exempt financial service, while a separately invoiced advisory fee is taxable at 13%, so we split the two before the return is filed rather than after CRA asks.
- Where a general partner takes a carried interest allocation instead of a fee, we document the entitlement in the partnership agreement, because CRA treats an invoiced performance fee as a taxable supply at 13% and a profit allocation differently.
- We identify losses denied as superficial under ITA section 54 where the same security was repurchased within 30 days by the corporation or an affiliated person, and amend the affected years before CRA reassesses them with arrears interest.
- We separate owner draws from the investment account and rebuild the shareholder loan continuity, because a balance left outstanding past the second consecutive year-end is included in personal income by CRA under ITA subsection 15(2).
- Where a prior accountant claimed the Small Business Deduction on property income, we correct the position under the specified investment business rule in ITA 125(7), which denies the deduction below six full-time employees and invites a CRA reassessment.
- We recover securities lending revenue and rebate amounts that were never posted, working from the custodian statements, because unreported income found later by CRA on the T2 carries a gross negligence exposure the corporation should not be carrying.
- We reclassify research and data costs such as the Bloomberg terminal subscription expense that were capitalized in error, releasing the deduction to the correct year on amended T2 returns filed with CRA rather than leaving it stranded in a CCA pool.
- When CRA argues that frequent trading is business income, we assemble the holding period, financing and intention record and defend the ITA section 39(4) Canadian securities election, which protects the one-half inclusion rate on every disposition in the year.
- We answer a T1135 audit with a year-end schedule of specified foreign property at cost, the $100,000 threshold test and custodian confirmations, so CRA cancels the penalty rather than confirming it on assessment.
- Where FINTRAC reporting and an OSC examination overlap with a CRA query on the same year, we answer all three from one reconciled record set behind Form 31-103F1 and the T2, inside the 30-day OSC filing window.
- Where a shareholder is non-resident, we review Part XIII withholding on dividends at 25% or the treaty rate and file the NR4 return, because CRA assesses the corporation for tax it failed to withhold, not the shareholder.
- When CRA questions a foreign holding structure, we file or correct T1134 for each foreign affiliate and reconcile the FAPI computation, so the $2,500 per-affiliate penalty is avoided and the foreign tax credit position is preserved.
- We prepare CSRS 4200 compilation financial statements that support your exempt market dealer compliance filing, because lenders, custodians and the OSC treat CPA-compiled statements very differently from a spreadsheet exported out of the portfolio system.
- Firms holding investment fund manager registration in Ontario must file audited statements with the OSC within 90 days of year-end, and we prepare the underlying trial balance and working papers so the auditor is never the bottleneck.
- We classify portfolio dividend income, corporate interest income, realized gains and management fee revenue under the correct GIFI codes, so the compiled income statement and the T2 return agree line for line for CRA and for the lender.
- Notes disclose the basis of accounting, related-party transactions, shareholder loan terms and the errors and omissions insurance premium carried by the registrant, which is the disclosure package a margin lender and the OSC expect under CSRS 4200.
- Where a foreign affiliate exists, the notes disclose the FAPI foreign accrual property income inclusion and the related T1134 filing, so the lender is not surprised by a CRA tax liability that never appeared on the balance sheet.
- A mortgage investment corporation is structured under ITA section 130.1 with at least 20 shareholders and no shareholder above 25%, because failing either test costs the corporation its dividend deduction for the entire year and CRA taxes the income twice.
- We complete the CRA Business Number and RC1 registration alongside the articles so the corporate account opens at Wealthsimple or Interactive Brokers without a three-month delay, and bookkeeping runs from the first trade rather than the first year-end.
- We determine before the first outside dollar is managed whether NI 31-103 registration applies, because a registrant falling below the $25,000 minimum capital must file an OSC capital deficiency report immediately, and unregistered management is an enforcement matter.
- We put the share register, director resolutions and directors and officers insurance in place at incorporation and calendar the first short-year T2 with CRA, so the corporation passes custodian and bank onboarding on the first submission.
- Where the holding company will hold rental property alongside a securities portfolio, we design separate share classes under the OBCA at incorporation, so rental income, portfolio dividends and a future ITA section 85 rollover never force costly articles of amendment.
Investment Company Tax & Compliance Check
Six quick questions on your holding or investment corporation’s books, refundable tax and year-end setup. No fee shown.
1. Is your investment company a CCPC (Canadian-Controlled Private Corporation)?
2. Are your brokerage accounts reconciled and adjusted cost base tracked in QuickBooks or Xero?
3. Does the company earn passive income — interest, dividends, GICs or capital gains?
4. Is your RDTOH and capital dividend account (CDA) tracked and carried forward each year?
5. Do you hold foreign investments with cost over $100,000 (T1135 territory)?
6. Is this company associated with an operating company affected by the $50k passive-income SBD grind?
Free CPA Consultation for Investment Companies
Case Studies: Investment Company Accounting & Tax
Toronto Investment Holding Company – Small Business Deduction Protected
The problem: The client ran a profitable Ontario operating company and had been sweeping surplus cash into a holding company that quietly built up a growing securities portfolio. Nobody was tracking aggregate investment income on Schedule 7. By the time we were engaged, passive income had climbed well past the $50,000 threshold and was grinding the associated group’s $500,000 Small Business Deduction — every dollar of passive income above $50,000 was clawing back $5 of the limit and pushing more of the operating profit into tax at the general corporate rate. Two already-filed years had overpaid, and the owner had no idea it was happening.
What we did: We rebuilt the holding company’s books from the broker statements, established an accurate Schedule 7, and re-projected aggregate investment income for the current and following year. We shifted the portfolio toward deferred-growth holdings so realized passive income stayed under the threshold, planned the timing of eligible and non-eligible dividends to trigger the refundable tax, and coordinated the holdco and opco filings so intercorporate dividends flowed under ITA section 112 without Part IV tax. Quarterly monitoring was put in place so the number never drifts unnoticed again.
The result:
- Saved roughly $31,000 per year in corporate tax
- Full $500,000 Small Business Deduction preserved for the operating company
- Schedule 7 now projected and reviewed quarterly, not discovered at year-end
- Two prior years corrected, leaving a clean, defensible CRA position
Mississauga Mortgage Investment Corporation – Compliance Restored
The problem: A mortgage investment corporation had grown well past its original shareholder base, but the share register had not kept pace. Distributions and mortgage interest income were being reported inconsistently between the bookkeeping and the T2, and the ITA section 130.1 tests — at least 20 shareholders, with no single shareholder holding more than 25% — could no longer be evidenced from the records. Had CRA tested the year, the corporation risked losing its dividend deduction entirely, which would have taxed the same mortgage income twice.
What we did: We reconstructed the shareholder register from inception, confirmed the section 130.1 shareholder and asset tests for each year, and recalculated the dividend deduction so 100% of the qualifying income flowed out to shareholders as intended. Two prior years were amended to align the bookkeeping, the T5 slips and the T2, and we built a simple annual checklist so the MIC tests are documented every year before filing rather than reconstructed under audit.
The result:
- MIC status under ITA section 130.1 maintained and fully documented
- Recovered roughly $47,000 of tax on a single year by restoring the dividend deduction
- Bookkeeping, T5 slips and T2 now reconcile line for line
- Annual shareholder-test checklist prevents a repeat
Markham Family Holding Company – Capital Dividend Recovered
The problem: A family holding company had realized capital gains on its portfolio for the better part of a decade, but no one had ever tracked the capital dividend account. The non-taxable half of every realized gain should have been accumulating in the CDA, available to be paid to the family shareholders completely tax-free — and none of it had been. No T2054 election had ever been filed, and the incoming records gave no reliable balance to work from.
What we did: We rebuilt the capital dividend account from the corporation’s first year, verifying every realized gain and loss and every prior dividend against the brokerage and tax records to arrive at a balance CRA would accept. Once the CDA was verified, we filed the T2054 election on time and paid a capital dividend up to — but not over — the confirmed balance, because an election on an overstated CDA triggers Part III tax at 60% of the excess.
The result:
- $46,000 distributed to family shareholders completely tax-free
- Capital dividend account rebuilt from inception and fully supported
- T2054 election filed correctly, with no Part III tax exposure
- Ongoing CDA schedule maintained so future gains are captured
We make managing your investment company’s finances simple and stress-free. Our transparent process keeps your portfolio books, refundable-tax pools and T2 filings accurate and compliant at every stage.
Kickoff (document request)
Broker and custodian statements collected, prior T2 returns reviewed, Hubdoc broker statement capture set up for ongoing documents.
First 30 days (cleanup and setup)
Chart of accounts rebuilt, QuickBooks Online for investment corporations configured, opening ACB and refundable account balances established.
Monthly close
Broker reconciliation, brokerage commission expense posted to cost base, dividends and interest recorded, HST remittances where applicable.
Quarterly planning review
Aggregate investment income projected, performance fee accrual reviewed, dividend timing and capital dividend account position discussed.
Year-end close and T2 filing
Trial balance, compilation statements, T2 with all schedules, and Form 31-103F1 excess working capital support where the corporation is a registrant.
Get Your Investment Company Tax-Ready Today
Affordable Pricing for Investment Companies
We believe in clear, upfront pricing so you know exactly what to expect. All fees below include HST and are quoted on an annual basis.
- Tax Preparation (Corporation): From $400 per year, including HST
- Tax Return Filing (Corporation): From $400 per year, including HST
- Tax Compliance Audit – FREE CRA audit support for our clients
- Tax Strategy: FREE for our clients
- Accounting Base Plan: From $1,200 per year, including HST
- Bookkeeping Management: Free for our accounting clients
- Financial Reporting: Free for our accounting clients
- Business Formation: Flat $35, including HST
- Incorporation Process: Flat $35, including HST
- Entity Setup Assistance: Flat $35, including HST
- Full-Service Payroll for investment companies: From $1,500 per year, including HST
Payment is by Interac e-Transfer to info@gondaliyacpa.ca only. Security question: Not Applicable, as auto-deposit is enabled.
Meet Your Investment Company Accounting & Tax Team
Meet your lead investment company accountant. As your investment fund manager accountant and holding company adviser, you deal with the same two people every year.
What Our Clients Say
1300+ five-star reviews from business and investment company owners across Ontario and Canada.
Supporting Investment Companies Across Ontario
Clients often ask what records CRA wants for an investment corporation — we keep them in one place, at one of our offices or online.
Toronto (ON)
55 Queen St E Ste 1205, Toronto, ON M5C 1R6, Canada
+1 (647) 212-9559
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Mississauga (ON)
2100 Camilla Rd #716, Mississauga, ON L5A 2J8
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Brampton (ON)
4 Starhill Crescent, Brampton, ON L6R 2P9, Canada
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Scarborough (ON)
24 Clementine Square, Scarborough, ON M1G 2V7, Canada
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Vaughan (ON)
19 Cabinet Crescent, Woodbridge, ON L4L 6H9, Canada
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Oshawa (ON)
210 Durham St, Oshawa, ON L1J 5R3, Canada
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Ottawa (ON)
2090 Neepawa Ave a314, Ottawa, ON K2A 3L6, Canada
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Etobicoke (ON)
60 Stevenson Rd #1601, Etobicoke, ON M9V 2B4, Canada
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Hamilton (ON)
70 Starling Dr, Hamilton, ON L9A 0C5, Canada
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Guelph (ON)
1155 Gordon St, Guelph, ON N1L 1S8, Canada
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Windsor (ON)
4387 Guppy Ct, Windsor, ON N9G 2N8, Canada
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North York (ON)
150 Graydon Hall Dr #912, North York, ON M3A 3B2, Canada
+1 (647) 212-9559
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Investment Company Accounting & Tax FAQs
Related Industries We Serve
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Corporate tax planning for brokerages; bookkeeping for commission income; payroll and compliance. Relevant to a private equity fund accountant handling mortgage-backed holdings.
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Corporate tax planning for early-stage companies; bookkeeping and payroll; filing and advisory. The other side of the table from a day trading corporation accountant or angel investor.
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Corporate tax planning for consulting corporations; bookkeeping and payroll; filing and advisory. The usual starting point when clients ask whether their holding company should own their operating company.
Investment Company Accounting & Tax Done Right.
Portfolio bookkeeping, ACB tracking, RDTOH and CDA, T5/T3 slips, T1135 and year-round planning under one roof. AFFORDABLE flat fees, no hourly billing. Registered CPA Ontario. 1300+ five-star reviews. 30-Day Money-Back Guarantee.