Is Incorporating Your Business Right for You?
(NC) Finding the right structure for your business depends on your particular situation and needs. You may have a sole proprietorship now, or a partnership, but are considering the expansion of the operation. Or, perhaps you need more information on the incorporation option.
First, you will need to decide if you want your registered office to be located within Ontario or whether you want the flexibility of being located anywhere in Canada. You may only be interested in keeping your business within the province or you may want to expand on a more global scale.
Some of the benefits of incorporation are:
• Separate identity;
• Limited liability;
• Lower corporate tax rates;
• Greater access to capital;
• Continuous existence;
• Name protection.
Another factor that may help you decide is cost. Incorporation fees can depend on the type of incorporation you choose, or the location. You may also be required to file reports on an annual basis, depending on the type of incorporation selected.
With an incorporated business you can choose the most tax-efficient way to pay yourself, including dividends, salary, bonus or a combination. Also, because corporations are taxed separately from their owners and the corporate tax rate is generally lower than the individual tax rate, incorporation may offer you some fiscal advantages.
Additional information on business structures plus general information for entrepreneurs is available free-of-charge through Canada Business Ontario (CBO) at 1-888-576-4444 / (TTY) 1-800-457-8466, or at canadabusiness.ca.
CBO is a service provided through the Federal Economic Development Agency for Southern Ontario (FedDev Ontario). For further information on FedDev Ontario programs and services, visit FedDevOntario.gc.ca or call toll-free at 1-866-593-5505.