An incorporated business might feel like a necessity once you have begun growing your small business. After all, you would want the business entity to be separate from the owners. However, incorporating your business in Canada has many pros and cons.
The key is to understand these benefits to make the right decision. Here are some of the advantages and benefits of incorporating in Canada.
1. Limited Liability
One of the best benefits of incorporating your business is that you will not be personally liable for any losses that the business faces. Because of this, your personal assets will be protected in case the business defaults. Of course, this is a significant benefit because it means that you remain protected in the face of any business adversity.
In the long run, limited liability will provide you with additional security for your business. So, be sure to consider this important benefit of incorporating your business in Canada.
2. Easy Transfer Of Ownership
Easy transfer of ownership is one of the top benefits of incorporating in Canada that will help you attract more investments to the business. That is because angel investors and venture capital firms will want to know if they can get in and out of the investment without a disorganized business structure.
Besides that, they also want to know if the ownership can be transferred without any delays. When you incorporate a business, you will make it easy for all of this to take place. That is because owners will own shares, which will ensure ease of this process.
3. Lower Rate Of Tax
Incorporating a business in Canada means that you will have to pay a lower rate of tax. That is because corporations are always taxed separately from the owners. Because of this, the tax rate of corporations is lower than the tax rate of personal income.
So, in the long run, you will have to pay a lower tax rate for your corporation in Canada. However, it will help you save your money and finances.
4. Access To Capital Becomes Easier
Finally, one of the best benefits of incorporating in Canada is that your access to capital will become easier. That is because a corporation can easily borrow money at a lower rate. Besides that, they can also raise money by selling bonds or shares to shareholders.
Such benefits will enable the corporation to raise money with ease. So, if you want to reap this benefit, you should consider incorporating your business in no time.
Conclusion
These are all the benefits of incorporating in Canada that will help your business continue as a separate entity from yourself. Even if your business defaults, you will be safe from any liability.
Besides that, the corporation will have to pay lower tax rates, and you can easily get investors for your corporation. So, be sure to consider these benefits and decide whether you want to incorporate your business or not.
