The Myth of Corporate Tax Savings

Incorporating can lead to tax savings, but it is far from a given. If not structured and supported properly, it can actually lead to tax losses! The tax act aims to make incorporation ‘tax neutral’ so that when you add corporate taxes to personal taxes of the shareholder, you pay about the same all told as you would if you claimed that same income as an unincorporated business owner. So why incorporate? There are legal reasons, but I’m not a lawyer. Here’s the Financial Planning skinny on this business structure’s merits and risks.