Will I Have Enough to Retire? How Owners Live Off Their Corporation

For many incorporated owners, retirement income comes mostly from the corporation itself, not from an RRSP or a sale. The questions are how much is inside, how you'll draw it (dividends, salary, an IPP pension, RRSP and TFSA savings, or borrowing against a policy), and in what order. A sale of the business should be treated as a possible bonus, not the whole plan.

“I don’t have enough money just to sit on the beach somewhere”

That fear usually comes from counting the wrong things. Owners who paid themselves mainly in dividends often have small RRSPs, so retirement savings look thin. Meanwhile the corporation holds years of retained profit that never got counted as retirement money. The first step is a full count.

The three buckets

Bucket	What's in it	How dependable
Money in the corporation	Cash, investments, a holding company, an IPP, cash value in corporate-owned policies	Dependable if it's invested for income and drawn carefully
Personal savings and government benefits	RRSP, TFSA, non-registered savings, CPP (built only through salary), OAS	Dependable, but often smaller for dividend-paid owners
Selling the business	Proceeds, possibly sheltered in part by the Lifetime Capital Gains Exemption	Uncertain: timing, buyer and price are outside your control

Drawing it down

• Steady dividends. Spreading draws evenly over many years keeps more of each dollar in lower personal brackets than big one-off withdrawals.
• Salary while you still work builds RRSP room and CPP. Once you stop working, salary usually stops making sense.
• An Individual Pension Plan can pay a pension for life from money the corporation contributed. See IPPs.
• Capital dividends can come out without personal tax when the capital dividend account has a balance.
• Borrowing against policy cash value can supplement income for some owners, with real interest-rate and lender risk. See accessing policy cash value.

What owners tell us, and what Greg tells them

The retirement worry we hear on calls is often a different fear from tax on the way out: it's whether there's enough to live on. In one owner's words, it's not having enough to say “I'm hanging up the skates,” after years of putting everything back into the business, thinking someday it would be worth something.

Greg's view is that runway, the years you give yourself to plan, is very important and usually underappreciated. Owners regularly reach out in their early 70s, which makes things more complicated. On pensions he's blunt: an IPP doesn't work for the vast majority of people, including most who come to our IPP webinars, and younger owners especially. When it doesn't fit, other strategies sometimes do.

Who this is for, and who it isn't

Run your own numbers

Questions to ask your accountant

• What could the corporation pay me each year in retirement, after tax, without running out?
• Should I keep the corporation after I retire, or wind it up?
• How much CPP have I built, and is it worth paying more salary before I stop?
• Would an IPP make sense at my age and salary history?

Related guides

Frequently asked questions

Can I keep my corporation after I retire?

Yes. Many owners keep the corporation, often as a holding company, and draw dividends from it in retirement. Once there's no active business, its investment income is taxed as passive income, so how the money is invested matters.

How do I pay myself from my corporation in retirement?

Usually through dividends drawn steadily over many years, sometimes alongside a pension from an IPP, capital dividends when available, and personal RRSP, TFSA and CPP income. The right order depends on your province, age and other income.

Is an Individual Pension Plan better than an RRSP?

For some owners. An IPP usually allows more deductible room than an RRSP from the mid-40s on, but it needs a history of T4 salary and carries actuarial and filing costs. For younger owners or those paid only in dividends, an RRSP is usually simpler.

How is Dundas Wealth paid?

Dundas Wealth is an insurance brokerage (Dundas Life Inc., FSRA #37628M). The strategy session is free. If a life insurance policy is part of your plan and you decide to go ahead, the insurance carrier pays us a commission when the policy is placed. You don't pay us a fee, and if your structure is already right, your one-page brief will say so.

Figures are current as of 2026 and are general information, not tax, legal or investment advice. Rules and rates change, and how they apply depends on your facts. Confirm anything here with your accountant before acting. Dundas Wealth is an insurance brokerage (Dundas Life Inc., FSRA #37628M). We are paid by the insurance carrier if and when a policy is placed.