Personal real estate corporation Canada, personal real estate corporation benefits, set up a personal real estate corporation, Incorporate a Personal Real Estate Corporation

Important:
As of October 1, 2020, Personal Real Estate Corporations (PREC) have been permitted in Ontario. This is fantastic news for Ontario Realtors as it will allow those in higher tax bracket to defer (and potentially save) on taxes.

Incorporating a Personal Real Estate Corporation

Ontario personal real estate corporation package starts at $599. This includes agency filing fees ($99), Ontario government, admin and registry fees ($350), preparation of PREC article by Our Lgeal team ($100) and mandatory CRA business number set up ($50). We also provides one-stop services for other filing such as setting up CRA business number, corporate tax ID, HST account, corporation's by-laws and minutebook, corporate seal, filing mandatory initial return (within 60 days of incorporation) and more. In our urgent queue, your PREC corporation could be ready in two business hours.

business corporation in Canada here

Personal Real Estate Corporation

It's a very simple form, guides you step by step and takes 10-15 minutes to complete. However, you can get stuck in any step, our Agency has live chat and call support. our legal and accounting team review all orders before personal real estate corporation benefits. Incorp Pro is an agent of Business in Canada. Therefore, When you pay us to Incorporate a Personal Real Estate Corporation on be half of you, we first set up a personal real estate corporation. That would be free of cost. However, once a name is submitted to government, setup a Personal real estate corporation Canada, setup a personal real estate corporation benefits.

Rules for Personal Real Estate Corporations (PREC)
  1. The corporation is incorporated or continued under the Business Corporations Act.
  2. All of the equity shares of the corporation are legally and beneficially owned, directly or indirectly, by the controlling shareholder.
  3. The sole director of the corporation is the controlling shareholders.
  4. The president, being the sole officer of the corporation, is the controlling shareholder.
  5. There is no written provision by agreement or otherwise or arrangement that restricts or transfers in whole or in part the powers of the sole director to manage or supervise the management of the business and affairs of the corporation.
  6. Each non-equity share of the corporation is
    1. legally and beneficially owned, directly or indirectly, by the controlling shareholder,
    2. legally and beneficially owned, directly or indirectly, by a family member of the controlling shareholder, or
    3. owned legally by one or more individuals, as trustees, in trust for one or more children of the controlling shareholder who are minors, as beneficiaries.
Advantages of Personal Real Estate Corporation:
  • Lower corporate tax rate of 12.20% plus the agent’s personal taxes (depending on how much is withdrawn from the corporation) versus an average of 30% to 40% personal taxes on entire earnings.
  • Tax deferral opportunities – This allows you to grow money on tax deferral basis through various investment vehicles.
  • Income splitting between among spouse. Of course, be aware of TOSI rules (Tax on split income)
Disadvantages of Personal Real Estate Corporation:
  • A personal real estate corporation must have an article of corporation that comply with the specific rules and regulations. Hence the article of corporation is prepared by our legal and accounting team. And therefore, the cost of incorporation for a personal real estate corporation is higher than a regular standard corporation.