The exact amount depends on the mortgage size, interest rates (stress test), and your other debts. However, roughly speaking, for every $100,000 of mortgage you want, you need about $22,000 - $25,000 of verifiable annual income. Our calculator helps you find this exact number, which we call your
How to Use This Calculator
Step 1: Gather Your Numbers
Grab your most recent T1 General (Personal Tax Return) and open your business bank account or accounting software. You don't need to be exact to get a result, but better data equals a better strategy.
Step 2: Enter Your 'Anchor' Data
Tell us what you declared last year (Lines 10100 and 12000). This helps us see if you are on track or if you need to make a change this year.
Step 3: Analyze Your Business Health
Enter your corporate revenue and expenses. We use this to calculate your "Retained Earnings"—the pool of money available to you.
Step 4: Find Your Green Zone
The calculator will show you three different qualification scenarios. Find the one that puts you in the "Safe Zone" to create a winning strategy.
| ✅ What This Tool DOES | ❌ What This Tool DOES NOT Do |
|---|---|
| ✅ What This Tool DOES:Calculates "Required Income": Tells you exactly how much to claim to afford a specific payment. | ❌ What This Tool DOES NOT Do:It is NOT a Credit Check: We assume you have good credit (680+). Poor credit will change these numbers. |
| ✅ What This Tool DOES:Optimizes Tax Strategy: Finds the efficient mix of Salary vs. Dividends to satisfy the lender. | ❌ What This Tool DOES NOT Do:It is NOT Exact Tax Advice: Tax numbers are estimates. Always speak to your accountant before filing. |
| ✅ What This Tool DOES:Checks Solvency: Ensures your business has the cash to support the income you declare. | ❌ What This Tool DOES NOT Do: |
Your "Official" Income vs. Your "Mortgage" Income
If the number you see on the calculator above is higher than what you see on your tax return, don't panic. This is normal.
The Canada Revenue Agency (CRA) cares about your Total Income (Line 15000) because they want to tax you. Lenders care about your Solvency because they want you to pay them back. The gap between these two numbers is your "Hidden Income"—money you legally wrote off to save taxes, but that we can add back to help you qualify.
The "Old Rule" vs. "Our Truth": Why Business Owners Get Rejected
Most business owners believe the "Old Rule": "To get a mortgage, you must show high personal income on your tax return. If you write off expenses, you are 'too risky' for the bank."
Our Truth
You shouldn't be penalized for having a good accountant. Real lending expertise isn't about looking at your tax return; it's about reconstructing your business's true cash flow. We know that your 'expenses'—like your truck, your home office, and your depreciation—are actually cash in your pocket. We don't just look at what you declared; we look at what your business actually generated.
| The Factor | The "Amateur" View (Surface Level / Branch Rules) | The "Expert" View (Deep Dive / Underwriting Policy) |
|---|---|---|
| The Factor:The "Income" Number | The "Amateur" View (Surface Level / Branch Rules):Line 15000 (Total Income). A simple average of the last 2 years. | The "Expert" View (Deep Dive / Underwriting Policy):"Reconstructed" Net Income. Line 15000 + Add-Backs (CCA, Home Use, etc.). |
| The Factor:Corporate Income | The "Amateur" View (Surface Level / Branch Rules):Ignored. "If you didn't pay it to yourself, it doesn't exist." | The "Expert" View (Deep Dive / Underwriting Policy):Distributable Cash Flow. We can use corporate Net Income to boost borrowing power. |
| The Factor:Vehicle Leases | The "Amateur" View (Surface Level / Branch Rules):A Liability. Reduces your mortgage qualification by ~$120,000. | The "Expert" View (Deep Dive / Underwriting Policy):A Wash. Since the corp pays, we neutralize the debt hit. |
| The Factor:Declining Income | The "Amateur" View (Surface Level / Branch Rules):Automatic Fail. "We must use the lower number." | The "Expert" View (Deep Dive / Underwriting Policy):Narrative-Based Averaging. We add back one-time expenses to normalize the year. |
| The Factor:Down Payment Source | The "Amateur" View (Surface Level / Branch Rules):Personal Savings Only (90 days). | The "Expert" View (Deep Dive / Underwriting Policy):Corporate Liquidity. We can use funds directly from your business. |
| The Factor:The "2-Year" Rule | The "Amateur" View (Surface Level / Branch Rules):Mandatory. "Come back when you have 2 full years." | The "Expert" View (Deep Dive / Underwriting Policy):Continuity of Income. We stitch industry history together to bypass the clock. |
| The Factor:Operating Loss | The "Amateur" View (Surface Level / Branch Rules):"Your business lost money. You qualify for nothing." | The "Expert" View (Deep Dive / Underwriting Policy):"Paper Loss vs. Cash Loss." We add back CCA to turn a negative into a positive. |
How to Calculate Your "BFS Qualification Line" (The Mechanics)
The calculator above uses a specialized formula to find your "Real" income. It doesn't just ask for your annual salary; it asks for the components that make up your financial life. Here is exactly how we turn your tax return into mortgage approval.
The "Add-Backs": Turning Expenses Back Into Income
Not all expenses are created equal. "Cash Expenses" (like rent or staff salaries) are gone forever. "Non-Cash Expenses" (like depreciation) are still in your pocket. Lenders allow us to "Add Back" these specific lines to your income.
| Expense Type | Tax Form Location | The Rule |
|---|---|---|
| Expense Type:Capital Cost Allowance (CCA) | Tax Form Location:T1 General Line 9936 | The Rule:100% Paper Loss (Add Back) |
| Expense Type:Business-Use-of-Home | Tax Form Location:Line 9945 | The Rule:Add back max 15-20% of Income |
| Expense Type:Motor Vehicle Expenses | Tax Form Location:T2125 "Motor Vehicle" | The Rule:Add back if Corp pays |
The Dividend Advantage (Gross-Up)
If you pay yourself in dividends, you are taxed at a lower rate personally because the corporation has already paid tax. To level the playing field, lenders Gross Up your dividend income. This means $1.00 of Dividends counts as ~$1.15 of income for a mortgage.
| Scenario | Option A (Salary/T4) | Option B (Dividends) | Result |
|---|---|---|---|
| Scenario:Business Owner paying themselves $100,000 | Option A (Salary/T4):Qualifying Income = $100,000 | Option B (Dividends):Qualifying Income = ~$115,000 | Result:Option B qualifies for ~$60,000 more mortgage. |
The Corporate Net Income Advantage (NIAT Program)
What if you leave all your money in the company to save tax? Standard banks will say you have "No Income." We use the NIAT (Net Income After Tax) Program. This allows us to use your corporation's profit as if it were your personal income, drastically increasing your approval amount without triggering a tax bill.
| Scenario | Standard Method (Personal Income Only) | NIAT Method (Corporate Health) |
|---|---|---|
| Scenario:You paid yourself $80k, but your company's net income was $150k. | Standard Method (Personal Income Only):Qualifying Income = $80,000 | NIAT Method (Corporate Health):Qualifying Income can be boosted using a portion of the $150k, often exceeding $150k+. |
The Bank Statement Alternative (Stated Income)
Sometimes, even add-backs aren't enough. If your tax returns show very low income due to aggressive write-offs, we use a Stated Income program (Alt-A). Here, we ignore your tax return entirely and look at your business bank statements to prove cash flow.
| Metric | How It's Calculated | Who It's For |
|---|---|---|
| Metric:Qualifying Income | How It's Calculated:(Avg. Monthly Business Deposits * Lender's Percentage) - Est. Operating Costs | Who It's For:Businesses with high, consistent cash flow but aggressive write-offs that result in low net income on paper. |
Frequently Asked Questions
How much income do I need to show to qualify for a mortgage?+
My business makes way more than my personal tax return shows—why can't we use that?+
Major banks view "Business Revenue" as money that belongs to the company, not you. They only count what you transfer to yourself personally (via Salary or Dividends) and pay tax on. However, we can fix this by using Stated Income programs (which look at business bank statements) or Net Income After Tax programs (which look at corporate profit).
My accountant wrote off everything to save taxes. Did I screw myself?+
Not necessarily. While this hurts you with "A-Lenders" (Big Banks), it makes you a perfect candidate for "B-Lenders" or "Alt-A" lenders. These lenders understand that low net income is often just good tax planning. We can often qualify you using your gross cash flow instead of your net income.
I write off my car and my cell phone. Can we add that back to my income?+
Yes! This is called an "Add-Back." Since your business pays these expenses for you, they are essentially "hidden income." We can add 100% of your Capital Cost Allowance (Depreciation) and often a portion of your Vehicle and Home Office expenses back to your income to boost your qualification.
Is it better to pay myself Dividends or Salary if I want to buy a house?+
For qualifying purposes, Dividends are often slightly better. This is because lenders "gross up" your dividend income by ~15-20% to account for the fact that you paid less tax on it personally. However, T4 Salary shows stability. The best approach is often a mix, which our calculator helps you model.
How much mortgage can I afford if I pay myself $100k?+
If you have no other debts (no car loans, no credit card debt), $100,000 of income typically qualifies you for a mortgage between $400,000 and $450,000. This amount decreases significantly if you have a high car lease payment, which is why we try to write off the lease through the corporation.
Can I use my spouse's income to help if I write off my business income?+
Yes, absolutely. A spouse with a standard T4 job is the perfect "anchor" for a mortgage application. Their stable income lowers the lender's risk, which often allows us to be more aggressive with your self-employed add-backs and stated income calculations.
I have cash in my corporate account—why won't the bank count it?+
Banks view corporate cash as "encumbered"—meaning the business might need it for operations or taxes. This creates what we call the
Do I really have to wait until I've been self-employed for 2 full years?+
No. The "2-Year Rule" is for standard applications. If you have been in the same industry for a long time and just transitioned to self-employment, or if you have strong cash reserves, we can often qualify you with as little as 6-12 months of business history using specific insurer programs.
Why did the bank reject me when I have the cash for the down payment?+
The bank approves you based on your ability to make the monthly payment, not your ability to make the down payment. If your declared income is too low, you fail the "stress test" ratios (GDS/TDS), regardless of how much cash you have. The solution is to use our strategies to push your income above your specific
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