As a business grows, so does its needs. The decision to incorporate your business at any stage of your growth is a very important one and something that will dictate what you are able to do in the future. As your business changes and adapts so too should your business structure.
A common scenario is for businesses to start out as sole proprietorships or partnerships and become incorporated at a later date when the business has grown to a level that necessitates the switch. When incorporating your business, here are the main advantages to consider:
- You reduce your own personal liability
- Protect your personal assets
- Unlimited life-span
- Continue to exist irrespective of ownership
- Corporations can borrow
- Ability to borrow from the corporation
Lower Tax Rate
- Canadian-controlled private corporation tax is about 21%
- Personal income received as dividends or reinvested into the corporation
- Involving family members
- Reducing tax liability
Small Business Tax Deduction
- 16% on the first $200,000 of taxable income
- May lower tax rate
Incorporating your business can be complicated, but Positive Accounting is here to help. Contact us today for more information on what you need to do to get started.
Experts you can trust, advice you can rely on and results that matter.
That’s Positive Accounting!