Stay Ahead with Smart, Strategic Moves This Year
Whether you’re just wrapping up residency or have been in private practice for years, 2026 is the perfect time to take a fresh look at your financial plan, tax strategy, and corporate structure.
Canadian tax rules are always evolving, and physicians face unique planning opportunities — and risks — if things are left unchecked.
Here’s your physician-friendly checklist to stay on top of your finances heading into 2026.
- Review Your Salary vs. Dividends Mix
If you’re incorporated, now’s the time to review how you’re paying yourself. Consider:
- Salary to create RRSP room and contribute to the CPP
- Dividends for lower upfront taxes and administrative simplicity
A custom mix may optimize tax efficiency — especially with the small business deduction limit staying at $500,000 federally.
- Maximize RRSP and TFSA Contributions
For 2026:
- RRSP limit: Up to $33,810 (if earned income allows)
- TFSA limit: Now $7,000 per year, with cumulative room over $100,000 if unused since inception
These remain core tools for long-term, tax-sheltered wealth accumulation — especially when coordinated with corporate savings.
- Plan for the Passive Income Grind
If your medical corporation is investing through retained earnings, keep an eye on the $50,000 passive income threshold. Go above it, and you risk losing access to the small business tax rate.
Consider tax strategies like:
- Flowing funds to a holding company
- Reassessing investment types (e.g., corporate-class funds, life insurance strategies)
- Exploring active business investments through your holdco
- Review Lifetime Capital Gains Exemption (LCGE) Strategy
For doctors who may sell shares in a clinic, group practice, or related business in the future, the LCGE is a powerful tool — with a 2026 exemption limit over $1 million.
Planning now (e.g., via a family trust or purification steps) could preserve access to this valuable tax exemption later.
- Check Your CPP and EI Contributions
If you draw a salary through your MPC, the 2026 max CPP contribution is rising again. Make sure you’re not overpaying — especially if you’re also employed elsewhere or have staff on payroll.
Also, confirm if you should opt in or out of EI — physicians often skip it, but some planning cases (like parental leave) may warrant reconsideration.
- Revisit Insurance, IPPs, and Retirement Planning
As cash builds inside your corporation, are you exploring all your options?
- Individual Pension Plans (IPPs) for enhanced retirement contributions
- Corporate-owned life insurance as a tax-efficient estate planning tool
- Critical illness or disability coverage updated to your income level
- Talk to a Specialist Who Knows Physician Tax
Generic tax planning doesn’t cut it. Your income structure, practice setup, and goals are specific — and your strategy should be too.
At MedTax, we help incorporated doctors across Canada (excluding Quebec) with tailored, smart planning that’s aligned with CRA rules and built for real results.
Book a Free 30-Minute Consultation
Let’s map out your next smart move for 2026 — with tax-smart, doctor-specific advice. Contact one of our accountants today.
