July 13, 2014
INCORPORATION IN QUEBEC FOR YOUR MEDICAL PRACTICE
To not pay taxes like all taxpayers, they created a trust and only pays 15% in taxes and $ 9 per day for their children to the CPE as we all . They do not contribute to Quebec's economic activity, it is other grumpy $$$, social well-being of the rich.
Following the adoption in 2001 of the Act to amend the Code of Professions and other provisions laws concerning the exercise of professional activities within a company and the adoption in 2003 of the Regulation respecting the practice of the medical profession in society (the "Regulations"), members of the College of Physicians of Quebec ( hereinafter "the College") have, since 22 March 2007, the opportunity to practice their profession through a corporation. This article will summarize the main advantages of the incorporation of a medical practice, and the steps necessary for the establishment of a medical incorporation in Quebec.
POTENTIAL BENEFITS OF INCORPORATION
The company is now the vehicle of choice for the management of any business. By incorporating their medical practice, doctors can benefit from the following:
The company is now the vehicle of choice for the management of any business. By incorporating their medical practice, doctors can benefit from the following:
Deferred tax
The main advantage of incorporation is the ability to impose his professional income at the corporate rate that is more favorable than the tax rate of 48 % being the highest in Quebec. For example, on a $ 400,000 income generated and maintained in the company, the maximum tax rate is 19% compared to 48% if the same income had been generated by the professional. The corporate structure allows to postpone a $ 116,000 tax payment on the income mentioned above it and would be maintained in society.
The main advantage of incorporation is the ability to impose his professional income at the corporate rate that is more favorable than the tax rate of 48 % being the highest in Quebec. For example, on a $ 400,000 income generated and maintained in the company, the maximum tax rate is 19% compared to 48% if the same income had been generated by the professional. The corporate structure allows to postpone a $ 116,000 tax payment on the income mentioned above it and would be maintained in society.
However, even if the company offers the opportunity to enjoy tax benefits, deferred tax exists only temporarily. Thus, any income generated will be taxed at the personal level, when the declaration of dividends, upon the sale of shares or on the dissolution of the company.
2- Income Splitting
Another advantage of incorporation is to avail of the income splitting strategy with other members of his family. By issuing shares in the company to adults of his family members with lower tax rates, or a family trust, the dividends paid to them will be taxed at a lower rate.
Another advantage of incorporation is to avail of the income splitting strategy with other members of his family. By issuing shares in the company to adults of his family members with lower tax rates, or a family trust, the dividends paid to them will be taxed at a lower rate.
3. Protection against creditors
S adds the benefits of incorporation that the company's shareholder is granted a protection against unsecured creditors under the Company's operations. However, incorporation will not limit the professional liability of professionals and they could not escape from any claim arising from a breach of their professional obligations (professional negligence, etc.)
S adds the benefits of incorporation that the company's shareholder is granted a protection against unsecured creditors under the Company's operations. However, incorporation will not limit the professional liability of professionals and they could not escape from any claim arising from a breach of their professional obligations (professional negligence, etc.)
4- Individual Retirement Plan
Once in place it might be beneficial to society to establish an individual retirement plan for its shareholder withdraws a salary. In addition to other benefits, the individual retirement plan will enable the shareholder to contribute to its pension plan to a greater extent than the maximum allowed by the Plan Registered Retirement Savings Plan (RRSP).
Once in place it might be beneficial to society to establish an individual retirement plan for its shareholder withdraws a salary. In addition to other benefits, the individual retirement plan will enable the shareholder to contribute to its pension plan to a greater extent than the maximum allowed by the Plan Registered Retirement Savings Plan (RRSP).
5. The sale of the company
in Finally, in the company's share sale to a third party under the shareholder of the company could benefit from a tax exemption on capital gains up to $ 750,000, subject to certain conditions of the Law the income tax.
While this article provides a list of benefits of incorporation, the decision to adopt a corporate structure remains based on the needs and individual situations. It is therefore highly advisable to consult your financial planner, accountant or legal counsel to determine the legal structure most appropriate to your needs and to assess whether the financial benefits listed above outweigh their potential costs.
in Finally, in the company's share sale to a third party under the shareholder of the company could benefit from a tax exemption on capital gains up to $ 750,000, subject to certain conditions of the Law the income tax.
While this article provides a list of benefits of incorporation, the decision to adopt a corporate structure remains based on the needs and individual situations. It is therefore highly advisable to consult your financial planner, accountant or legal counsel to determine the legal structure most appropriate to your needs and to assess whether the financial benefits listed above outweigh their potential costs.
STAGES OF INCORPORATION OF MEDICAL PRACTICE
1- The articles of incorporation
In order to establish a professional medical society in Quebec, it is first necessary to complete and file the articles of incorporation in good standing with the Registrar of companies in Quebec. For discussion purposes we will treat professional incorporation under the laws of the Province of Quebec.
In order to establish a professional medical society in Quebec, it is first necessary to complete and file the articles of incorporation in good standing with the Registrar of companies in Quebec. For discussion purposes we will treat professional incorporation under the laws of the Province of Quebec.
2- The choice of name
The first decision to make is the choice of company name. Under section 41 of the Medical Act, no person may practice medicine under a name other than his own. However, it is possible for doctors to practice under the name of one or more partners. Moreover, the choice of name will be subject to the provisions of the Companies Act and the Act respecting the legal publicity of enterprises.
The first decision to make is the choice of company name. Under section 41 of the Medical Act, no person may practice medicine under a name other than his own. However, it is possible for doctors to practice under the name of one or more partners. Moreover, the choice of name will be subject to the provisions of the Companies Act and the Act respecting the legal publicity of enterprises.
3- Establishment of the corporate structure
A professional medical society in Quebec is subject to a series of regulations in with respect to individuals who are invested with power to control it. Indeed, a medical professional incorporation can be composed of doctors, the husband (is) the professional, persons related by blood or marriage and / or union, and any other legal entity and / or trusts (as long as the latter two entities are controlled by those mentioned above).
Note that other professionals governed by the Professions Code may not be shareholders of a professional medical society.
Although the shareholders of a medical society may vary, as that described above, all of the voting shares of professional medical society are required to be held by the shareholder doctor. Non-voting shares may be owned by a family trust of Québec established for you and your family.
A professional medical society in Quebec is subject to a series of regulations in with respect to individuals who are invested with power to control it. Indeed, a medical professional incorporation can be composed of doctors, the husband (is) the professional, persons related by blood or marriage and / or union, and any other legal entity and / or trusts (as long as the latter two entities are controlled by those mentioned above).
Note that other professionals governed by the Professions Code may not be shareholders of a professional medical society.
Although the shareholders of a medical society may vary, as that described above, all of the voting shares of professional medical society are required to be held by the shareholder doctor. Non-voting shares may be owned by a family trust of Québec established for you and your family.
4- Declaration submitted to the College of Physicians
order to incorporate and practice under a professional medical society, the physician must also pass the College a series of documents, all as provided in the Regulations.
order to incorporate and practice under a professional medical society, the physician must also pass the College a series of documents, all as provided in the Regulations.
THEY DO NOT PAY THEIR DUE TO THE COMPANY
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