Corporate Retirement Solution

If you are the owner of a corporation or a majority shareholder in a Canadian corporation with taxable investments, the Corporate Retirement Solution could help you protect your business, reduce corporate taxes, grow your business assets, while increasing your future personal retirement cash flow at the same time.

The way it works is simple. A participating whole life insurance policy is purchased by the corporation on your life and the corporation serves as the beneficiary of the policy. Corporate surplus from taxable investments is then reallocated into the participating whole life insurance policy to reduce tax.

When you structure a corporate-owned participating whole life policy using one of our Bank On Whole Life™ concepts, you can use the cash value to fund business expenses during your working years. However, under current tax law, as the cash value in your policy continues to grow, it can later serve as funding or a supplemental stream of tax-free retirement income when you do stop working.

The funds within the policy grow on a tax-advantaged basis which you can later use as collateral for a tax-free bank loan to fund or supplement your retirement income. Upon your death, the corporation receives the life insurance proceeds, (death benefit) and receives a tax-free dividend from the capital dividend account to your estate. Your estate pays off the retirement funding loan and retains the balance.