6 worked RDTOH and Dividend Refund Planning case studies — the position a client typically comes to us with, what we do, and what it is worth. Each is an illustrative example built on the rules that apply to rdtoh and dividend refund planning work, not a specific client's file.
Case Study 1 · Objection and relief
Desk-Review Assessment Of $34,000 Vacated — Three-Location Franchisee, Edmonton
Client: A franchise operator with three locations · Where: Edmonton, Alberta · Engagement: 10 weeks, fixed fee
Assessment vacated$34,000
Supporting recordsNow on file
AccountCleared
The situation — A franchise operator with three locations, Edmonton, Alberta
A franchise operator with three locations in Edmonton, Alberta was carrying $34,000 of penalties and interest. The charges arose from a balance-due date the owner believed was the same as the filing date. Much of that amount accumulated during a period the CRA itself had delayed.
What we did for A franchise operator with three locations, Edmonton, Alberta
We rebuilt the instalment schedule off the current year rather than the prior year, ending the interest accrual. We framed the relief application on the specific grounds the CRA guidelines recognise rather than on general hardship.
The result — A franchise operator with three locations, Edmonton, Alberta
The assessment was vacated. $34,000 came off the account, and the documentation now on file makes the same position straightforward to defend next time.
Case Study 2 · Deadline rescue
6-Week Turnaround Beat The Deadline And Saved $32,500 — Corporation Holding Investments, Calgary
Client: An operating company holding surplus investments · Where: Calgary, Alberta · Engagement: 6 weeks, fixed fee
Late-filing penalty avoided$32,500
Filed with12 days to spare
Next yearPapers ready
The situation — An operating company holding surplus investments, Calgary, Alberta
An operating company holding surplus investments in Calgary, Alberta was weeks away from the deadline for RDTOH and dividend refund planning. Behind that sat a loss year carried forward by default when carrying it back would have produced a refund cheque. The exposure if the date slipped was around $32,500.
What we did for An operating company holding surplus investments, Calgary, Alberta
We reviewed each capital cost allowance pool and set the claim at the level that kept the small business deduction fully used rather than wasted. The filing went in complete rather than provisional, so there was no amended return to follow.
The result — An operating company holding surplus investments, Calgary, Alberta
Filed with 12 days to spare. $32,500 in late-filing penalties avoided, and the working papers are ready for the following year.
Case Study 3 · Records and systems rebuilt
Books Rebuilt From Source, $19,500 In Unclaimed Input Tax Found — Incorporated Consultancy, Guelph
The situation — An incorporated consultancy, Guelph, Ontario
An incorporated consultancy in Guelph, Ontario could not answer basic questions about its own numbers. A small business limit quietly shared across three associated corporations nobody had mapped sat between the bank statements and the ledger.
What we did for An incorporated consultancy, Guelph, Ontario
We carried the non-capital loss back against the two profitable years and recovered tax already paid instead of holding a carry-forward balance. We then documented the process so the work does not depend on any one person remembering how it was done.
The result — An incorporated consultancy, Guelph, Ontario
Records rebuilt and reconciled, $19,500 recovered in input tax credits that the old file could not support, and a documented monthly process now in place.
Case Study 4 · Cash and remittance control
Instalments Rebased, $132,000 Of Cash Returned To The Business — Instalment-Paying Corporation, Moncton
Client: A corporation paying instalments on prior-year figures · Where: Moncton, New Brunswick · Engagement: 8 weeks, fixed fee
Cash returned$132,000
Instalment basisCurrent year
ReviewedQuarterly
The situation — A corporation paying instalments on prior-year figures, Moncton, New Brunswick
A corporation paying instalments on prior-year figures in Moncton, New Brunswick was paying instalments calculated on a prior year. That year no longer reflected the business. Two corporations under common control filing as if each had its own $500,000 limit was tying up $132,000 of cash.
What we did for A corporation paying instalments on prior-year figures, Moncton, New Brunswick
We rebased the instalments on the current-year estimate rather than the prior-year default. Alongside that, we moved passive holdings into a separate structure so the operating company’s small business limit stopped grinding down.
The result — A corporation paying instalments on prior-year figures, Moncton, New Brunswick
$132,000 of cash stayed in the business, the penalty cycle ended, and the instalment position is reviewed each quarter against actual results.
Case Study 5 · Planning that cut the bill
$53,000 Saved By Correcting What Prior Filings Had Missed — Corporate Rental Portfolio, Red Deer
Client: A corporately-owned rental portfolio · Where: Red Deer, Alberta · Engagement: 3 weeks, fixed fee
Saving identified$53,000
RecurringYes
Positions documentedAll
The situation — A corporately-owned rental portfolio, Red Deer, Alberta
A corporately-owned rental portfolio in Red Deer, Alberta asked for a second opinion on RDTOH and dividend refund planning. That followed three years of rising tax. The review found a distribution treated as tax-free capital dividend with no election ever filed.
What we did for A corporately-owned rental portfolio, Red Deer, Alberta
We built the comparison first: current structure against two alternatives. Then we documented safe income before the inter-corporate dividend was paid, so subsection 55(2) had no room to recharacterise it as a gain.
The result — A corporately-owned rental portfolio, Red Deer, Alberta
First-year saving of $53,000, with the same benefit recurring. Every position taken is documented and supported in the file.
Case Study 6 · Scaling without breaking
Growth Handled Without A Missed Filing, $27,000 Freed — Non-Calendar Year-End Corporation, Brampton
Client: A corporation with a non-calendar fiscal year-end · Where: Brampton, Ontario · Engagement: 10 weeks, fixed fee
Cash freed$27,000
Compliance failuresNone
ReportingMonthly
The situation — A corporation with a non-calendar fiscal year-end, Brampton, Ontario
A corporation with a non-calendar fiscal year-end in Brampton, Ontario was opening in a second province. That meant different filing obligations and a different payroll regime. Passive investment income that had crossed the $50,000 grind threshold unnoticed already sat in the file.
What we did for A corporation with a non-calendar fiscal year-end, Brampton, Ontario
We modelled salary against dividends across both the corporation and the shareholder’s personal return, then set the remuneration mix for the year. We then put monthly reporting in place. That let the owner see the cash effect of growth while there was still time to act on it.
The result — A corporation with a non-calendar fiscal year-end, Brampton, Ontario
Growth was absorbed without a compliance failure. $27,000 of cash was released, and the monthly reporting now flags a problem while it is still small.
Reviewed by Udit Gupta, Founder and Tax Accountant for the 2025 tax year. These case studies are illustrative worked examples composed from the CRA rules that apply to this type of work, not specific client files; figures are representative and outcomes depend on your own facts.
