Incorporate or not: this is the question Posted on Aug 16, 2019
Should you incorporate your business? Here are quick bullet points that will help you to decide:
Corporate tax rate is lower than personal but you can’t use the earning from the corporation without taking the money out to a personal level. Hence, a good rule of thumb is, if your corporate earnings are higher than salary/dividend you plan to take out for personal needs, then likely you can save tax by incorporating.
Corporation protects your personal assets. If you are in a business that has higher probability of being sued, corporation helps to limit the liability to assets owned by it. Hence your personal property such as your house can’t be forced to be sold to pay the liabilities of the corporation.
Some income splitting could be achieved by employing members of the family in your business. They should be actually working and you should be able to prove it.