A Canadian-controlled private corporation (CCPC) is a private corporation resident in Canada that is not controlled, directly or indirectly, by non-residents, public corporations, or any combination of them. The status is defined in section 125(7) of the Income Tax Act and unlocks several tax preferences.
CCPC status matters for the small business deduction on active business income, access to the lifetime capital gains exemption on qualifying shares, refundable taxes on investment income, and the capital dividend account. Control can be lost through acquisition by non-residents or public corporations, which has consequences for the small business deduction, refundable taxes, and loss carryforwards. Because so many benefits hinge on it, monitoring CCPC status is a recurring planning concern.