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Legal Ease
Legal Ease, Lawyer
Category: Canada Tax
Satisfied Customers: 100934
Experience:  Lawyer
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I recently incorporated a business that I had been operating

Customer Question

I recently incorporated a business that I had been operating for years as a sole proprietor. For tax purposes,
1)is it better to use the company LTD than the sole proprietorship? I use both currently.
2)What are the advantages of the LTD?
3) If I were sued or went into bankruptcy what difference does a LTD company over a sole proprietorship have?
Submitted: 2 years ago.
Category: Canada Tax
Expert:  Legal Ease replied 2 years ago.

The main difference is that a corporation is a separate legal entity.

So if the corporation is held liable for something you will not be. It is a valid way to protect your own assets.

If the corporation is sued or declares bankruptcy you are not going to be hurt.

The only time a director is personally liable is if there is malfeasance or if there are unpaid wages or tax remittances or if the corporation collects sales tax and does not remit it.

Also thank you for requesting me on the other post. Unfortunately another lawyer answered before I had a chance to reply.

If you want me to answer just post again but this time put my name, it is Legal Ease, into the question. Then it will be left for me.