On November 14, the New Brunswick government introduced legislation to lower the small business corporate income tax rate to 2.5 per cent effective April 1, 2018. Legislation was also introduced to help self-employed New Brunswickers and employees of small and medium-sized businesses save for retirement through Pooled Registered Pension Plans (PRPP).
The tax reduction is the fourth consecutive small business tax reduction and applies on the first $500,000 of income.
The new Pooled Registered Pension Plans Act aims to reduce the administrative burden of operating a pension plan and make offering a pension plan more attractive and affordable for small and medium-sized businesses.
The new provisions will allow a worker to join a PRPP and make contributions to a pension fund if they are self-employed or if their employer does not provide a pension plan. An employer may also contribute, but it is voluntary.
Because the employee contributions would be pooled, the plan would offer investment and savings opportunities with lower administration costs.