Incorporation or not - making mortgage interest deductible


I have started a new business and it has taken off. I have spoke to one
accountant who said to go partnership. I have several family members and
established business associates saying to incorporate. How do I know whats
best for me. I work in property services sector and need a good accountant.
I am finding this process more stressful than bringing in new contracts.
david ingram replies:

I commend your accountant for keeping you in a proprietorship or

If your mortgage interest is already deductible, than incorporating may /
might / could possibly be a good idea. However, if it is only you and your
wife running it, there are more disadvantages than advantages.

Goto and read the November 2001 Newsletter in the top left
hand box. The first page deals with American stuff and then the next 9
pages deal with making your interest deductible which is almost impossible
if you are incorporated.

I would charge a minimum of $424 (inc GST) for a consultation on the subject
but you can get most by reading that newsletter.

Fred Snyder's seminars also deal with the subject and are free.

Every Thursday Evening, Fred Snyder of Dundee Wealth Management conducts one
of 17 different financial seminars in the boardroom of his office

Time: 7:00 to 9:30 PM
Date: Every Thursday evening
Place 1764 West Seventh
Vancouver (corner of Burrard)

Phone (604) 731-8900 to register

No cost - no obligation

Topics always cover mortgage interest as a deduction

other topics - getting the mortgage, estate planning, critical care
insurance, income taxation, differences between stocks and bonds, and
usually the most innovative HELOC mortgage offered in Canada from Manulife

If you are starting in downtown Vancouver and do not want to go home first,
one of the excellent THAI HOUSE restaurants is in the same building and
makes a nice start to the evening. If it is your first seminar, Fred will
buy you dinner if you are pre-registered.

I, david ingram, will be at the Thursday evening following the last Sunday
of each month to cover mortgage interest as a deduction and give the class
an adding test.

This older question will also give you an idea of my attitude to the

My_question_is: Canadian-specific
Subject: US Corporation vs Canadian Corporation
Expert: [email protected]
Date: Thursday November 23, 2006
Time: 10:14 PM -0500


I live in Ontario, Canada and earn business income in New York doing
consulting work. Does it make more sense to Incorporate a US Company or a
Canadian Company for tax purposes.

Also, would there be any changes to the answer if I was earning investment
income or Capital gains?

david ingram replies:

Unless there is some exceptional reason I am not aware of, I think you
would be nuts to incorporate in either place.

I could do one simple thing to increase the gross revenue of my business by
$150,000 to $300,000 per year in one day. HOW? you may ask.

Simple, I would just take 200 of my self-employed clients and suggest that I
think it is time they were incorporated. They would jump at the chance
because secretly, we all want to be president of our own corporation; we
think it sounds better socially than "proprietor".

After 100 of them had incorporated I would then be able to charge between
$1,000 and $3,000 more per year for their work if they were just in one
country. Put them in two countries and $10,000 is more likely than $5,000.

WHY DON'T I do it?

Well, for the most part, the only people benefiting from a corporation is
the lawyer and accountant who put it together.

You may be the exception, but I would have to see it first.

In my 43 years in practice, I can not identify a single instance where the
ownership of a corporation kept a person from financial ruin or bankruptcy.
I can think of dozens if not hundreds where the existence of the corporation
caused a personal bankruptcy or financial ruin.

The really silly part of this is that it takes ten minutes to convince
someone to incorporate and three hours to talk them out of it if their
brother, banker or best friend has suggested it.

And the really silly people are those with a rather simple business
incorporate on both sides of the border. They turn a simple $1,000
accounting fee into $5,000 to $15,000 a year and half the time put their
working status in jeopardy on one side of the border or the other.

goto and read the Nov 2001 Newsletter in the top left hand