Skilled Mississauga Business Lawyers Providing Guidance on Personal Real Estate Corporations
With the release of Ontario Regulation 536/20, under the Real Estate and Business Brokers Act, real estate professionals in Ontario have gained the ability to incorporate a Personal Real Estate Corporation. This long-awaited change means that real estate agents and brokers can now take advantage of significant corporate tax benefits previously unavailable to them.
At Bader Law in Mississauga, our business lawyers offer a comprehensive service to real estate professionals looking to incorporate. We will take care of the entire incorporation, from completing and filing the necessary legal paperwork to organizing and structuring the corporation.
What is a Personal Real Estate Corporation?
A Personal Real Estate Corporation is a business structure that enables real estate professionals employed by a real estate brokerage to earn their income through a corporation, rather than personally. This provides them with significant tax deferral and income structuring opportunities they wouldn’t enjoy otherwise.
Advantages of a Personal Real Estate Corporation (PREC)
Personal Real Estate Corporations present a number of benefits to real estate professionals, particularly those who earn a significant annual income. With the corporate tax rate in Canada significantly lower than the highest personal tax rate, a PREC can help real estate agents and brokers save significantly on their annual tax bill. In addition, a PREC grants the controlling shareholder further benefits, including:
- The ability to split income among lower-income earning family members who are engaged in the business;
- Saving on Canada Pension Plan contributions by structuring income as dividends rather than salary;
- The ability to reinvest your tax savings into your business, allowing you to grow more quickly; and
- The ability to defer personal income to a low-earning year in order to minimize your tax obligations year-to-year.
How Bader Law Can Help Get Your Personal Real Estate Corporation Started
At Bader Law, we work with business clients ranging from small family-run operations to large enterprises and have extensive experience organizing new corporations to maximize benefits to the shareholders. We will advise on all aspects of creating your Personal Real Estate Corporation and take care of all administrative tasks, so you don’t have to. We will take care of each step of your incorporation, including:
- Incorporation and all associated government filings
- Organizational tasks, including the creation of the following:
- General Bylaw Number 1
- Election and appointment of Directors and Officers
- Issuance of shares
- Minute book
Contact Bader Law for Experienced Advice and Assistance with Personal Real Estate Corporations in Mississauga & the Greater Toronto Area
The Mississauga lawyers at Bader Law have been developing relationships with realtors throughout Mississauga and throughout the Greater Toronto Area for over a decade as part of our real estate practice. We will ensure your Personal Real Estate Corporation is structured to maximize your benefits under the structure while minimizing your personal risk. Contact us online or at (289) 652-9092 to learn how we can help.