EO CPA – QBO Welcome Kit for Clients (Professional Services)

Thinking of incorporating your business?
Before you take the leap, it’s important to understand the benefits, responsibilities, and timing involved. This guide outlines what you should consider — and how we can help.

1. Liability Protection

Why it matters:
Incorporation separates your personal and business assets. If the corporation is sued or faces debt, your personal property is generally protected.

Best for:
Businesses with employees, clients, or contracts that carry risk.

2. Tax Planning Opportunities

Potential benefits include:

Lower corporate tax rate on the first $500,000 of active business income.
Income splitting (where eligible under TOSI rules).
Deferring personal tax by leaving money in the corporation.

We can help run the numbers to see if incorporation saves you tax.

3. Costs & Compliance

What to expect:

Incorporation fees (federal or provincial)
Annual corporate tax filings (T2)
Legal setup and bookkeeping requirements
Ongoing maintenance (minute book, resolutions)

Tip: If your income is still growing or unpredictable, it may be worth waiting.

4. Professional Regulations

Are you a regulated professional?
Doctors, dentists, accountants, engineers and others may need a Professional Corporation (PC) with special rules.

We’ll help you stay compliant with your regulatory body.

5. Business Image & Growth

Incorporation can:

Boost your business’s credibility
Help secure financing or investors
Make it easier to bring on partners
Protect your business name across Canada (if federally incorporated)

6. Succession & Exit Planning

Looking to the future:

Sell or pass on shares more easily
Potential access to the Lifetime Capital Gains Exemption (currently over $1 million)

Plan ahead to maximize long-term value.

When Incorporation Might NOT Make Sense

Income is low or inconsistent

You draw most of your business income for personal use
You prefer simpler administration and bookkeeping

Let’s Talk First

Incorporation is a powerful tool — but only when the timing and structure are right.

We can help you:
✔ Compare tax scenarios
✔ Choose the right jurisdiction
✔ Understand holding companies and trusts
✔ Handle your corporate filings

👋 Ready to Explore Incorporation?

EO Chartered Professional Accountant
🌐 www.eocpa.ca

This document is for informational purposes only and does not constitute legal or tax advice. Please contact us or your legal advisor for guidance specific to your situation.