What lenders typically ask for:
- Your last two years of personal tax returns (T1 Generals) and Notices of Assessment.
- Corporate financial statements, especially if you want income left in the company to count.
- Proof that you own the corporation and how you're paid (salary, dividends, or both).
Where professionals get caught:
- Tax-efficient isn't mortgage-efficient. A low personal income looks good on your tax bill and weak on a mortgage application.
- Two-year averages. A big jump in income this year may not count fully until it shows up on two years of returns.
- Timing. If you're planning to buy in the next year or two, talk to your accountant and mortgage broker together before you set your compensation. It's much easier to plan this than to fix it after the fact.
Options if your personal income looks low. Some lenders have programs for incorporated professionals that recognize retained earnings or gross up dividend income. A good broker will know which lenders do this, and on what terms.
