Hi David,
Saw your article in Ozzie's newsletter - don't know if you respond to email
questions. Here goes.
I am looking at purchasing some apartment properties in Northern Ontario -
maybe up to $2M. I live in Vancouver, BC. I work for a living - part-time
as a consultant under my own limited company ($6-7KK/month income, claim
most expenses through this), and part-time as an employee for BCIT
($3K/month income).
The properties will be generating positive cash - therefore no losses from
them. Expect to hold them for 5 years+ or so. Not for short term flipping.
Should I purchase these in my personal name, under my limited company which
I normally do consulting (don't mind mixing things up if there is an
advantage), or open a new limited company strictly for real estate
investment?
Any advice or articles you can point me to?
Thanks
==================================================
david ingram replies:
Owning rental property in a corporation generates the highest tax rate in
Canada because it is not considered active business. Mixing it with a
consulting business could leave you liable to higher income there as well if
the rental gross exceeds your consulting gross.
Of the top of my head, I suggest that you keep the properties in your own
name and buy good insurance policies to cover public liability.
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