Registering a numbered company in Alberta?

[Mook32]

Some shares have been offered to me and all of the other shareholders use numbered companies to hold their shares. I am looking to do the same. Anyone registered a numbered company in Alberta? Any recommendations? Did you use a lawyer? Do it yourself? Any idea on cost? And annual cost to maintain it?
Thanks for any help!

Cheers!

[Hack&Lube]

You don't need a lawyer. Just go to any registry and do it, it's pocket change to start it up and they have all the forms there. Also get bank account associated with the numbered company.

The real cost is your annual return is corporate now which can be a few hundred bucks. Talk to Locke!

[Jacks]

Depends if you have more time than money.
I bought my # company from my lawyer. It was all set up with a complete minute book, resolutions, share structure and certificates, etc. he just signed the shares over to me and it was good to go. That was several years ago, don't remember the exact cost, think it was $400 or $500?

[Kjesse]

The charge from the province if you do everything yourself is $275 for the incorporation. Every registry will up-charge that, as they will have a service fee. I think registries, who provide no advice, offer an all-in price of about $550 these days which includes the most basic of documents, but not a minute book.

The company you incorporate has to file annual returns, which will cost you every year, and the company will have to file a separate tax return, which also adds a cost every year.

The starting point should be to figure out if you want shares in the first place, and if the associated expenses are worth it to you. Even very basic holding companies will attract a thousand dollars or so in legal and accounting expenses in every year, if they're handled properly, and that is just the lowest, basic, entry price. I have the knowledge to do my own annual returns but I actually pay another lawyer to do mine. Its just not worth the hassle to add it the to-do list, and the peace of mind knowing it is taken care of is more than worth it.

I get asked these kinds of questions often from people and I suggest that if they want to pay the lowest costs possible, either make damn sure they have the basic know-how of how to do the basic documents and the ability to keep a calendar to track a deadline that will occur every year, or just hand it over to someone else. The cost of fixing a problem will make the legal and accounting fees associated with annual maintenance feel like a pat on the back. Also, if the costs of annual returns and incorporation fees and extra accounting fees are significant to them in relation to the upside, they should re-evaluate whether becoming a shareholder is worth it to them. Becoming a shareholder comes with more than just tax flexibility and limited liability.

[TheSutterDynasty]

My lawyer was $1200 and that was by far the most inexpensive I saw. Then ~$200 accountant fee on top of that, plus the annual cost for corporate/personal taxes and I assume a fee for the lawyer to hold my minute book.

Most seemed $2k +

[Ashartus]

I used a numbered company for holding shares in a previous employer; at my current company I hold them personally. A few things to think about:

- Are you likely to own more than 10% of the company? In that case there might be some advantage to using a numbered company under current tax rules. Basically your numbered company wouldn't pay tax on dividends since it would be considered a related company. I used this approach to re-invest my dividends in my employer. There would still be tax implications when you remove money from the numbered company.

- Do you have a spouse in a lower tax bracket? If you have family members with different classes of shares you can potentially use it as a form of income splitting by issuing dividends to the class of shares your spouse has. I'm not sure how the upcoming tax changes will affect the ability to do that though.

If neither of those are the case, you're probably better off holding shares individually due to the costs of the numbered company - legal costs, annual accounting costs for taxes, fees for having a corporate bank account, etc.

[troutman]

Talk to an accountant first to see whether it is even beneficial in your circumstances.

I think most suburban law firms would charge you around $1000 (includes government registration fees). Annual returns for around $250. Business related legal fees are tax deductible.

[Mook32]

Thanks very much everyone! I really appreciate it!
I will speak with an accountant and see what they say and go from there!

Cheers!

[northcrunk]

It's easy to register a corporation. The cheapest place in town to do it is the registry on 52nd and memorial.

[Shazam]

Why do you want to hold the shares in a corporation? You will lose out on the personal lifetime cap gains exception then.