Estate Planning
3 min read

The Benefits of Forming a Corporation in Ontario

Written by
The Tabuchi Law Team
Published on
October 18, 2022

Why Incorporate in Ontario?

When you incorporate your business in Ontario, get ready to unlock a world of incredible benefits that will skyrocket your growth to unprecedented levels. We're about to embark on an exciting journey together, diving deep into these advantages and shedding light on why countless companies eagerly opt for the incorporation route. Brace yourself to discover the exceptional perks on this remarkable journey!

Limited Liability

One of the most beneficial advantages of incorporating is safeguarding your assets. When you decide to incorporate, your business becomes its legal entity, separate from you as the owner or shareholder. This means your business can autonomously operate, own assets, and incur liabilities. By forming a corporation, you create a protective shield around your personal belongings, such as your home and savings, shielding them from the financial obligations and liabilities of the company. It's like giving your personal life an insurance policy, ensuring that even if your business encounters challenging economic circumstances, your personal life remains financially secure. Choose the path of incorporation and fortify your personal and financial future confidently.

Tax Advantages | Potential for Lower Tax Rates

A corporation's most substantial advantage over other business structures is the potential for lower tax rates. Translation?

Substantial savings. By enjoying these lower tax rates, corporations can maximize their profits and reinvest significantly into expanding their operations. Corporations can also utilize dividends to their advantage by strategically distributing income among shareholders. This income-splitting tactic allows for effectual tax planning and decreases the overall tax burden on the family's income. This is a massive game-changer for businesses that inspires intelligent financial decisions and drives long-term success.


So, why do corporations love lower tax rates? Besides the obvious benefits to their bottom line, it also opens up exciting possibilities for income splitting among shareholders. You can dramatically reduce your overall tax burden by distributing dividends to family members who are also shareholders but in lower tax brackets. It's like a power move that can give you a competitive edge while maximizing your business's potential. So, embrace the opportunity to take advantage of lower tax rates and watch your business soar!

A Corporation Can Help Protect Your Assets

Why Incorporate in Ontario?

Access to Capital | Easier Fundraising

Incorporated businesses have a significant advantage when it comes to accessing capital. Through the issuance of shares of stock, corporations have enhanced opportunities to raise funds. They can explore various channels, such as issuing stocks and bonds or seeking investment from venture capital firms and angel investors. By incorporating, businesses can tap into a broader pool of investors, making attracting funding for growth and expansion easier.


Not only does incorporation facilitate fundraising, but it also conveys a more professional and established image compared to unincorporated businesses like sole proprietorships or partnerships. Investors often prefer dealing with formal legal entities that provide greater transparency and legal protection.


With a registered corporation, you can also add more personality to your fundraising efforts. The story behind your company's inception, the unique value proposition you bring to the table, and the passionate team driving your vision - these aspects can truly engage potential investors and make them more excited to join your journey.


Seek Expert Advice

While incorporating your business in Ontario presents extraordinary benefits, fully comprehending the legal and financial implications involved is crucial. For factors like ensuring personal assets are adequately protected, creating a solid business plan with a compelling value proposition, and clearly understanding the market, consulting with legal and financial professionals who can guide you through incorporating while providing ongoing advice on corporate compliance and risk management is imperative.  At Tabuchi Law, our team specializes in corporate law and offers tailored advice and guidance to ensure you make informed decisions.

Contact us today to schedule your incorporation consultation!

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