When is it the right time to incorporate?
The answer to this question can vary from individual to individual. However, we can certainly help you make a well informed decision.
There are a few main reasons why you should incorporate your business:
- Shareholders of corporations have limited liability for business risks.
- Income splitting opportunities with other shareholders.
- If you meet certain criteria, when you sell your corporate shares, you may be eligible to trigger the lifetime capital gains exemption.
- As a corporation is a separate legal entity, it is taxed separate from its owners. Corporate tax rates are lower, in most cases, than personal tax rates.
- Corporations have more ability to raise money, which may make it easier for your business to grow and develop.
- Estate planning benefits resulting from the fact that corporations continue to exist in spite of a death or removal of a shareholder or director.
- Incorporated businesses have a better image and are more likely to attract investors than unincorporated businesses.