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Hello, I am filling my personal taxes as well as my corporation taxes. Let me give you a scenario.
I personally have 1000$ and I transfer this money as a loan to my own corporation. Then my corporation spent 500$ on business-related purchases. Now my company has 500$ and I have 0$
The loan is meant to be paid at some point but not this year.
How do claim that I lent money to my corporation on my personal income tax return?
How do I claim this loan on my business income tax? Is it technically income? Thanks
Do not report shareholder loans made by you to your corporation on your personal tax return. In your example, the corporation owes you $500. This is not income, but is a shareholder loan payable. When the company has available cash, it can pay you back the remaining balance ($500) tax-free. Note that shareholder loans should be reported on Schedule 11 of the T2 Corporate Tax Return.