The Challenge
Physicians earning $500K–$700K annually face one of the highest lifetime tax burdens in Canada. For incorporated doctors, optimizing corporate structures and building long-term tax-efficient wealth is essential for financial independence.
A corporate-owned participating whole life policy is one of the most effective tools available. It provides stable, tax-deferred growth, supports retirement planning, and functions as a superior alternative—or complement—to traditional RRSP strategies.
Key Pain Points
RRSP Limitations
RRSP room is based on earned income and capped annually. A $600K income physician can contribute only about $30,780. Withdrawals are 100% taxable.
Need for Lower Tax Rates
Corporate tax (12.2%–26.5%) is significantly lower than personal tax (up to 53.53%). Physicians need to retain more profit inside the corporation.
Corporate Par vs. RRSP
Corporate Par policies provide no contribution limits, tax-deferred growth, and tax-free access in retirement via policy loans.
Flexibility in Income Timing
Physicians can control when and how they take money out—optimal for maternity/paternity leave, part-time transitions, or early retirement.
Enhanced Retirement
Corporate structures allow physicians to use corporate-owned insurance and access CDA tax-free distributions.
Ideal Policy Design
Example: Annual premium $100k-$200k funded from retained earnings. 10 or 20 pay period. Retirement access via bank/policy loans.
Long-Term Outcomes
By age 65: Strong, tax-deferred cash value inside the corporation. Reduction in personal taxable withdrawals.
At Death
Tax-Free
Large insurance payout
CDA Credits
100%
Tax-free distribution to heirs
Liquidity
High
Fund estate taxes without forced sale
Summary of Value
See Your Own Numbers
Every corporation is unique. Schedule a consultation to model these strategies with your financial data.
Book a Private Strategy Review