# Tax on capital gain for corporation



## moneypool (Feb 20, 2010)

If a company is incorporated and the only business is to buy and sell stocks. The capital gain is the main revenue and expenses could be trading fee, office rental, salary and etc. Will it be taxed on revenue or net income (revenue - expenses)?

Thanks.

Moneypool


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## MoneyGal (Apr 24, 2009)

You are talking about setting up what is known as a specified investment corporation. 

The short answer is that the special lower tax rates for Canadian-controlled private corporations are not available for corporations who derive their revenues principally from property (=capital gains), not active business income, unless they have at least five full-time employees. 

Google "specified investment corporation" for way more information.


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## moneypool (Feb 20, 2010)

Thanks. MoneyGal.

I googled and still could not find much useful information. Could you more specify?


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