Calgarypuck Forums - The Unofficial Calgary Flames Fan Community - View Single Post - Benefits/Drawbacks of Incoporating in Alberta?

Discoste · 04-08-2011, 11:14 AM

Generalizing here:

Sole Prop - all profits and losses belong to you. You claim everything on your personal tax return every year. All liabilities are with you.

Incorporating- there's extra hoop you have to jump through with payroll and more paperwork (clients pay your company, then your company pays yourself). You have to file corporate tax return as well as your personal return.

The advantages are that you can keep money in the company and pay the lower corporate tax rate vs personal rate (and declare dividends). There's limited liability so people can't sue you personally (in most cases).

04-08-2011, 11:14 AM	#7
Discoste Backup Goalie Join Date: Oct 2009 Location: In front of a monitor or TV Exp:	Generalizing here: Sole Prop - all profits and losses belong to you. You claim everything on your personal tax return every year. All liabilities are with you. Incorporating- there's extra hoop you have to jump through with payroll and more paperwork (clients pay your company, then your company pays yourself). You have to file corporate tax return as well as your personal return. The advantages are that you can keep money in the company and pay the lower corporate tax rate vs personal rate (and declare dividends). There's limited liability so people can't sue you personally (in most cases). Last edited by Discoste; 04-08-2011 at 11:17 AM.