Capital Dividend Account Planning

Unlock the Full Benefit of Your CDA

The Capital Dividend Account (CDA) is one of the most tax-advantaged tools available to Canadian private corporations; however, without proper planning, its potential can be overlooked or misapplied. We help business owners understand, manage, and strategically use the CDA to maximize after-tax shareholder value. Whether it’s triggered by life insurance proceeds, capital gains, or other eligible amounts, we provide clear advice on timing, elections, and documentation, so your capital dividends are distributed tax-free and with confidence.

Our CDA Planning Services Include:

CDA Balance Calculations

We accurately determine the tax-free portion of your CDA based on your corporation’s history and current transactions.

Election Filing (T2054)

We prepare and file the required elections to designate payments as capital dividends in a timely and compliant manner, in accordance with CRA requirements.

Strategic Distribution Timing

We advise on the most effective timing and sequencing of capital dividend payments in coordination with broader tax and estate planning.

Life Insurance Planning

We help ensure life insurance proceeds are recorded correctly and fully leveraged within the CDA, particularly in succession or buyout contexts.

Coordination with Legal Advisors

We work alongside your legal team to structure share redemptions or reorganizations in a way that optimizes CDA use and minimizes audit exposure.

Why Clients Choose HW Partners for CDA Planning

Deep knowledge of CRA policies and filing requirements
Clear documentation to support tax-free distributions
Integrated approach that aligns with estate and tax strategy

Meet the Team Behind Our CDA Planning Services

Our professionals work closely with owner-managers, estate advisors, and legal counsel to ensure every CDA decision is informed, timely, and strategic.