Sean Caulfeild Real Estate

Top Ten Reasons to own a PREC
Reason Number 2 - Lower Income Tax Rates
In Ontario, the corporate tax rate for 2020 is 12.2% on the first $500,000 of active business income (real estate commissions), and then taxed at the general corporate tax rate of 26.5% for business income over $500,000. In contrast, in 2020, the lowest personal tax rate for a sole proprietor is 20.05%, and the highest is 53.53% on any income earned over $220,000. For those agents and brokers that earn net incomes that cover their living costs, the opportunity is there to reduce their tax rates by incorporating their businesses.

“We incorporate real estate professionals across Ontario. Email us with your questions or book a free 30-minute consultation.”

Top Ten Reasons to own a PREC
Reason Number 3 - Limited Liability
The shareholders of a professional corporation are generally protected from the financial liabilities of the corporation. The protection exists because a company is a separate legal entity from its owners and the company has the sole responsible for its debts and obligations. However, this is not the same for a sole proprietor who assumes personal liability for the business’s debts and obligations. In essence, the professional corporation acts as a shield against personal liability on the parts of the business owners. You will remain personally liable for the services you provide to Ontario’s consumers and will be held accountable by RECO for breaches of TRESA and misconduct

“We incorporate real estate professionals across Ontario. Email us with your questions or book a free 30-minute consultation.”