Whether or not to incorporate, that is the question. Or at least, that is a question that we get asked often.

There is no simple and straight-forward answer to this, and we hate to say it, but it will depend on your business and some circumstances involved, such as: risk level, costs, and number of people involved in the operation and management of the business.

If you are just starting out, or currently operating a business as a sole proprietor or in a partnership with others, the following are some key considerations to keep in mind to determine whether to incorporate a business:

Risks to you personally – Limited Liability

A company is a separate legal entity – Costs

limited liability, but since it is – increased costs.

One the legal side, there is an upfront cost to incorporate the company (please see our fee page for more details on our fees), and a yearly cost of filing annual reports.

link to business structuring page

Tax Reasons / Benefits

Can be tax benefits, in particular once there is a pool of money in the company – consult an accountant – we can provide referrals

Structuring

Can be easier to structure than a partnership – and involvement of the individuals or companies involved can be structured in a more sophisticated way, clearly delineating: owners of the business (shareholders) and each ownership stake; the directors of the business (appointed or elected, that manage the affairs of the company); and officers of the company (appointed by directors).

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