ContactA trend these days is for companies to ask their employees to incorporated themselves. Why? Because the company is no longer required to remit any source deductions on your behalf (think CPP and EI), they do not need to provide you with a benefits package, no overtime payout, vacation pay and there is less red tape to let their employees go.
The incorporation process is relatively easy and quick and it can seem attractive to become an incorporated employee (also known as a Personal Services Business), however, the tax implications of a PSB are different than other types of corporations.
In order to be a PSB, one must pass two important tests:
If you are offered to become an incorporated employee (or if you are not sure), please talk to us for some guidance. We are happy to help!