Dentists Drowning in Debt
The two young dentists were partners in two clinics in downtown Toronto, and had plans to open a third. Wishing to provide their patients with the best environment for their treatment, they had recently outfitted the clinics with new equipment and leasehold improvements, financed through bank loans.
Since the practice was operated as a partnership, the individuals had to handle these loans as part of their personal tax returns. Principal on debt repayment is not tax deductible in Canada, so between loan payments and personal tax rates approaching 50%, these two young professionals had very little money left to enjoy their lives. Understandably, they dreaded visiting their accountant in April.
When they came to Cusimano Professional Corporation, the first thing we did was help them incorporate their practice, which significantly reduced their marginal tax rates and lifted a large financial burden from their shoulders. These much less stressed professionals are now actually enjoying their business.