Home -> Glossary -> Information for Business Owners -> Real Estate and Canadian Tax Issues, Home Buyer Incentives -> Specified Investment Business
Specified Investment Business (SIB)
Income Tax Act s. 125(7), 129(6)
A specified investment business is a corporation whose principal purpose is to derive income (interest, rent, dividends and royalties) from property, unless the business employs more than 5 full-time employees throughout the taxation year. Income from property would include rental or leasing income from land or buildings, but would exclude income from renting or leasing moveable property such as machinery and equipment.
A specified investment business is not eligible for the small business deduction, and the income is taxed in the corporation in the same way that investment income is taxed. There is an exception to this when the investment income is received from an associated corporation earning active business income. An example would be a holding company leasing property to an associated corporation earning active business income.
TaxTips.ca ResourcesCorporate Income Tax Rates
Canada Revenue Agency (CRA) Resources
T4012 Corporate Income Tax Guide Chapter 4 - scroll down to Specified Investment Business
Tax Tip: Get professional tax advice about this!
Revised: October 26, 2023
Copyright © 2002 Boat Harbour Investments Ltd. All Rights Reserved. See Reproduction of information from TaxTips.ca