Incorporate

An incorporated company affords protection from any personal liability for your business debts and obligations. For example, if someone sues your company they can only go after your company’s assets, not your own (although there are exceptions – see below**under “The Disadvantages of Incorporation”).

If you incorporate you may gain tax benefits, although only under certain circumstances. This is one area to discuss with an accountant, as the marginal tax rates for corporations with taxable incomes in some cases can be higher than those for an individual in the same scale. Read more about the tax implications of incorporating from the government here.

The fees associated with initial incorporation and ongoing maintenance can put a strain on start-ups. However, LLCs (a hybrid-type of legal structure that provides the limited liability features of a corporation and the tax efficiencies and operational flexibility of a partnership ) can be a more economic alternative to incorporation.

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