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Originally Posted by WarrenC12
Corporations allow a ton of flexibility. RRSPs have pretty strict rules around contributions and withdrawals, and of course are subject to personal income tax rates, the highest of all tax rates. You can't even take advantage of income splitting with your spouse.
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RRSP have strict rules about contribution limits which is a percentage of your employment income, but the withdrawals aren't that strict unless you're specifically taking it out for the Home Buyer's Plan or Life Learning Plan. Plenty of people withdraw from their RRSP when their taxable income for the year is low (e.g. on leave, travel/rest between switching jobs, time off after severance), so that they can purposely avoid the highest tax rates.
For Canadian private corps, it sounds like you're operating under the outdated Chretien-Harper era SBD rules. Since Trudeau came to power, they have severely restricted income splitting with the TOSI rules, and enacted the passive income clawback of the small business rate deduction. Also, aggregate investment income in a Canadian private corp is taxed at a high rate, with an extremely punitive prepayment of tax that's only partially refunded after the Canadian private corp declares a dividend. After integration, the tax paid on investment income by the corp + tax paid on the dividends is in the ballpark of a high-income individual who earned the investment income individually.
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RRSPs are a useful tool, but not as good as TFSAs.
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TFSA of course is the gold star, one of Harper's greatest legacies to encourage Canadians to save by copying the US IRA Roth.