A Strategic Guide to Managing Trapped Cash in Your Business

You've built a successful business. Through years of hard work, careful decision-making, and perhaps a bit of good fortune, your corporation now has surplus cash beyond what's needed for operations and growth. It's a good problem to have, but it's still a problem.

You've built a successful business, right? And you're sitting on some company cash in the corporation. I bet if you're like a lot of the business owners that we talk to, you're probably just getting hit with advice from every direction like, ‘keep it in the corporation’, ‘invest it in the markets’ or we’ll create super complicated structures. It's kind of enough to make your head spin, especially when you're really just trying to figure out the smartest way to manage that wealth for yourself, your family, and your future, all without getting totally lost in a sea of financial jargon.

This surplus represents both opportunity and challenge. Left unaddressed, it can lead to higher corporate taxes, reduced eligibility for the small business deduction, and missed opportunities for personal wealth building. Extracted inefficiently, it triggers unnecessary taxation that erodes the very wealth you've worked so hard to build.

The truth is that simply having trapped cash in your business doesn't mean you're winning the wealth-building game. What matters is what you do with it.