My_question_is: Canadian-specific Subject: Incorporation Expert: taxman at centa.com Date: Monday February 12, 2007 Time: 02:36 PM -0500 QUESTION: I have started a new business and it has taken off. I have spoke to one accountant who said to go partnership. I have several family members and established business associates saying to incorporate. How do I know whats best for me. I work in property services sector and need a good accountant. I am finding this process more stressful than bringing in new contracts. ----------------------------------- david ingram replies: I commend your accountant for keeping you in a proprietorship or partnership. If your mortgage interest is already deductible, than incorporating may / might / could possibly be a good idea. However, if it is only you and your wife running it, there are more disadvantages than advantages. Goto www.centa.com and read the November 2001 Newsletter in the top left hand box. The first page deals with American stuff and then the next 9 pages deal with making your interest deductible which is almost impossible if you are incorporated. I would charge a minimum of $424 (inc GST) for a consultation on the subject but you can get most by reading that newsletter. Fred Snyder's seminars also deal with the subject and are free. Every Thursday Evening, Fred Snyder of Dundee Wealth Management conducts one of 17 different financial seminars in the boardroom of his office Time: 7:00 to 9:30 PM Date: Every Thursday evening Place 1764 West Seventh Vancouver (corner of Burrard) Phone (604) 731-8900 to register No cost - no obligation Topics always cover mortgage interest as a deduction other topics - getting the mortgage, estate planning, critical care insurance, income taxation, differences between stocks and bonds, and usually the most innovative HELOC mortgage offered in Canada from Manulife Bank If you are starting in downtown Vancouver and do not want to go home first, one of the excellent THAI HOUSE restaurants is in the same building and makes a nice start to the evening. If it is your first seminar, Fred will buy you dinner if you are pre-registered. I, david ingram, will be at the Thursday evening following the last Sunday of each month to cover mortgage interest as a deduction and give the class an adding test. This older question will also give you an idea of my attitude to the subject. My_question_is: Canadian-specific Subject: US Corporation vs Canadian Corporation Expert: taxman at centa.com Date: Thursday November 23, 2006 Time: 10:14 PM -0500 QUESTION: I live in Ontario, Canada and earn business income in New York doing consulting work. Does it make more sense to Incorporate a US Company or a Canadian Company for tax purposes. Also, would there be any changes to the answer if I was earning investment income or Capital gains? ------------------------------ david ingram replies: Unless there is some exceptional reason I am not aware of, I think you would be nuts to incorporate in either place. I could do one simple thing to increase the gross revenue of my business by $150,000 to $300,000 per year in one day. HOW? you may ask. Simple, I would just take 200 of my self-employed clients and suggest that I think it is time they were incorporated. They would jump at the chance because secretly, we all want to be president of our own corporation; we think it sounds better socially than "proprietor". After 100 of them had incorporated I would then be able to charge between $1,000 and $3,000 more per year for their work if they were just in one country. Put them in two countries and $10,000 is more likely than $5,000. WHY DON'T I do it? Well, for the most part, the only people benefiting from a corporation is the lawyer and accountant who put it together. You may be the exception, but I would have to see it first. In my 43 years in practice, I can not identify a single instance where the ownership of a corporation kept a person from financial ruin or bankruptcy. I can think of dozens if not hundreds where the existence of the corporation caused a personal bankruptcy or financial ruin. The really silly part of this is that it takes ten minutes to convince someone to incorporate and three hours to talk them out of it if their brother, banker or best friend has suggested it. And the really silly people are those with a rather simple business incorporate on both sides of the border. They turn a simple $1,000 accounting fee into $5,000 to $15,000 a year and half the time put their working status in jeopardy on one side of the border or the other. goto www.centa.com and read the Nov 2001 Newsletter in the top left hand box. --------------------------------------------------- David Ingram's US / Canada Services US / Canada / Mexico tax, Immigration and working Visa Specialists US / Canada Real Estate Specialists My Home office is at: 4466 Prospect Road North Vancouver, BC, CANADA, V7N 3L7 Cell (604) 657-8451 - (604) 980-0321 Fax (604) 980-0325 Calls welcomed from 10 AM to 10 PM 7 days a week Vancouver (LA) time - (please do not fax or phone outside of those hours as this is a home office) email to taxman at centa.com <mailto:taxman at centa.com> www.centa.com <http://www.centa.com/> www.david-ingram.com <http://www.david-ingram.com/> Disclaimer: This question has been answered without detailed information or consultation and is to be regarded only as general comment. Nothing in this message is or should be construed as advice in any particular circumstances. No contract exists between the reader and the author and any and all non-contractual duties are expressly denied. All readers should obtain formal advice from a competent and appropriately qualified legal practitioner or tax specialist for expert help, assistance, preparation, or consultation in connection with personal or business affairs such as at www.centa.com <http://www.centa.com> . If you forward this message, this disclaimer must be included." Be ALERT, the world needs more "lerts" David Ingram gives expert income tax & immigration help to non-resident Americans & Canadians from New York to California to Saudi Arabia to Mexico to China or Chile - Cross border, dual citizen - out of country investments are all handled with competence & authority. 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Nothing in this message is or should be construed as advice in any particular circumstances. No contract exists between the reader and the author and any and all non-contractual duties are expressly denied. All readers should obtain formal advice from a competent and appropriately qualified legal practitioner or tax specialist for expert help, assistance, preparation, or consultation in connection with personal or business affairs such as at www.centa.com <http://www.centa.com> . If you forward this message, this disclaimer must be included." 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