# Dissolution of Canadian Corporation

**URL:** <https://www.protaxcommunity.com/t/dissolution-of-canadian-corporation/10097>\
**Category:** Tax Topics\
**Created:** [February 25, 2025, 4:55pm UTC](https://www.protaxcommunity.com/t/dissolution-of-canadian-corporation/10097 "2025-02-25T16:55:14Z")\
**Posts on this page:** 2\
**Page:** 1

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**Author:** ![wini.leecpa](https://avatars.discourse-cdn.com/v4/letter/w/8c91f0/32.png) [@wini.leecpa](https://www.protaxcommunity.com/u/wini.leecpa)\
**Post date:** [February 25, 2025, 4:55pm UTC](https://www.protaxcommunity.com/t/dissolution-of-canadian-corporation/10097/1 "2025-02-25T16:55:15Z")

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Hi everyone,

I am new in the field of Canadian taxation and I need some guidance about dissolving a corporation.

1. The corporation has positive retained earnings and if I have to dissolve it, should I pay out the entire retained earnings as final dividends? The corporation’s year end is Dec, so should I need to payout the dividends in Feb 2025 ?
2. The corporation also has NCL balance from previous and current year, can I transfer this to the shareholder’s personal income tax ? If yes how can I do it.

Thanks in advance for the guidance.

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**Author:** ![Nezzer](https://sea2.discourse-cdn.com/flex016/user_avatar/www.protaxcommunity.com/nezzer/32/3845_2.png) [@Nezzer](https://www.protaxcommunity.com/u/Nezzer)\
**Post date:** [February 26, 2025, 5:17am UTC](https://www.protaxcommunity.com/t/dissolution-of-canadian-corporation/10097/2 "2025-02-26T05:17:31Z")

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I think you need to do the accounting work before you start looking at the taxes. Before dissolving a corporation, you need to liquidate all assets and settle all liabilities. In the process of doing that, the retained earnings should end up at zero (provided you are using standard double-entry accounting).

The answer to your second question is no.