what kind of corporations there are in canada and what are the advantages and dissadvatages of incorporating your business...

The corporation is the most popular form of business structure in Canada, which isn't surprising when you consider the difference in liability protection the corporation provides (as opposed to a sole proprietorship). Canadian corporations are also taxed differently than other forms of business. The most obvious tax change is that as a corporation is a legal entity in itself, the corporation is taxed separately from the individual. (As a business owner, you file both T1 (personal) and T2 (corporate) income tax forms.) But tax-wise, there are also different types of corporation, and the type of corporation determines whether or not the corporation is entitled to certain rates and deductions. if you choose to incorporate your business. This can be done at the federal or provincial level. When you incorporate your business, it is considered to be a legal entity that is separate from the owners and shareholders. As a shareholder of a corporation, you will not be personally liable for the debts, obligations or acts of the corporation.


types of corporations in canda :

canadian controled private corporation (ccpc)

the "other" private corporation

public corporation

"other" corporation

Advantages of incorporating:

limited liability

ownership is transferable

continuous existence

separate legal entity

easier to raise capital

possible tax advantage as taxes may be lower for an incorporated business

Disadvantages of incorporating:

a corporation is closely regulated
more expensive to incorporate than a partnership or sole proprietorship

extensive corporate records required, including shareholder and director meetings, and documentation filed annually with the government

possible conflict between shareholders and directors

possible problem with residency of directors, if they are in another province or the majority are not Canadian