The Citizen, 2000-10-25, Page 12PAGE 12. THE CITIZEN, WEDNESDAY, OCTOBER 25, 2000.
Looking at incorporation for small businesses
Two employees of a
manufacturing concern in Ontario -
feeling creatively and otherwise
stifled in their workplace - decided
to leave their employer and start
their own competing business.
In the first few years, all of the
business profits went straight to
maintaining the families of the two
individuals. Within five years,
however, the business grew until the
income exceeded their needs and
could be reinvested in the company.
At that point, the pair was advised to
incorporate, with the two being
equal shareholders.
Incorporation produced three
positive results: the resulting tax
savings and tax deferrals made it
easier to repay corporate loans; it
facilitated bringing in a third
individual to share ownership of the
business; and it provided some
measure of creditor protection in
periods of economic downturns.
HERC helps with career options
The week of Oct. 20 has been
designated as Career Week in
Canada. However at the Huron
Employment Resource Centres
(HERC) every week is career week.
If you are looking for work,
considering a job change or
interested in upgrading your skills,
HERC is here to help.
Staff help determine what steps are
necessary to meet career goals.
Information and referrals are
provided to help people connect with
the right program or service to meet
“These clients of our firm really
are a textbook example of the
advantages of - incorporation,”
explains Paul Coleman, CA, adding
that, today, 20 years after the launch
of the company, his clients continue
to prosper.
Incorporation basically means
transferring your business into a
corporation while you, the owner,
become a shareholder and employee
in the new, separately taxable entity.
While taking this step can save - or
defer - considerable taxes, and offer
a wide variety of other benefits,
advises Jerry Paskowitz, CA, it is not
for everyone and you should really
talk it over with your chartered
accountant to make sure it will be a
profitable move for you.
The main advantages of
incorporation include:
• Various opportunities for tax
savings and/or deferral.
• The possibility of splitting
their needs.
The centres provide job postings,
computer and internet access, free
employment related faxing and
photocopying services as well as
community information. Application
forms for employment insurance as
well as other income security
programs are also available in the
offices.
There are five HERC sites within
Huron County - Clinton, Exeter,
Goderich, Seaforth and Wingham.
These sites are funded by Human
income among family members.
• Estate planning that will allow
you to leave more money to your
children.
• Limited liability and protection
from creditors. If, for example, the
company goes bankrupt, creditors
can’t chase the owners for
repayment of money owed.
• Making it easier to obtain outside
capital through the sale of equity.
• The owners may each qualify for
a $500,000 capital gains exemption
when the business is sold.
According to Coleman, businesses
particularly benefit from
incorporation “if they are at risk for
product liability claims, such as
those selling pharmaceuticals, food
products and other types of
consumer goods, or those in an
inherently high-risk industry, such as
construction.”
Paskowitz says that a really small
business or one providing personal
Resources Development Canada and
operated by community partners.
Each location provides one stop
access for individuals requiring
information on a wide variety of
labour market adjustment programs
and services.
For employers, HERC is a source
of information on skills training
programs, wage subsidies and other
related topics.
The Wingham HERC office is
located at 108 Scott St. and is open
from 8:30 a.m. to 4 p.m. weekdays.
services (such as maintenance or
bookkeeping) to its owners, “may
not gain significant benefits from
incorporation.” Nor will companies
set up for a relatively short time,
such as a student’s summer painting
business, adds Coleman.
Prospective business owners
should also consider the additional
complexity and cost of
incorporation, Paskowitz points out.
“You have to keep accounting
records, minutes of shareholders’
and directors’ meetings and prepare
annual financial statements. Then,
these financial statements must be
filed, ' along with an annual
information return. And there are
penalties if you don’t file the proper
returns at the appropriate times. This
is all in addition to your personal tax
filing requirements.”
“The right time to incorporate
would be when the benefits
outweigh the costs - or are expected
Call 357-4995 for more information
or to set an appointment to meet with
local case manager, Joanne Weber.
The Oil Can Man
Oil Undercoating Mobile Service
(Individual & Commercial Vehicles)
Scott Stevenson
"Spring and Fall"
to outweigh them in the very near
future,” Coleman recommends,
stressing that the many complex
issues to be “weighed” require the
expert professional advice of a
chartered accountant to ensure that
the outcome is a healthier - not just
a more complex - bottom line.
Brought to you by The Institute of
Chartered Accountants of Ontario.
ELECT RALPH WATSON
COUNCILLOR HURON EAST
BRUSSELS WARD
Call 887-6236 for a ride to the polls
to vote for
Ralph Watson - Nov. 13
Royal Fair kicks-off Nov. 2
RR #2 Auburn N0M 1E0
Call for appointment 519-526-7607
With the fall season well
underway, it is time once more to
begin planing for the Royal Winter
Fair in Toronto, Nov. 2-11.
As with every Royal, there will
thousands of animals and fowl to
observe, and exhibits to interest the
crowds. For 2000, there are several
new features planned.
The champion of champions, a
salute to the millennium, will name
the best-of-the-show in all
commodities.
The winners from various breeds
will compete for the ‘supreme’ title
while winners in non-breed
categories will receive best-of-show
honours immediately after judging
for the class.
The Royal Canadian Mounted
Police musical ride will excite young
and old alike. After a three-year
absence the musical ride will
perform on opening night, Nov. 3, a
matinee and evening show Nov. 4
and Nov. 6 and 7.
A free show will be open to the
public Tuesday, Nov. 7 in the
afternoon.
The Bank of Montreal will present
a three-part agri-business speaker
series, running Nov. 3, 6 and 7, from
3 p.m. to 5 p.m. Topics include
identity preservation, rural/urban
interface and free trade. Information
on the invitation-only seminars can
be obtained through the International
Agri-Business Centre.
The focus will be on Canadian
craft beers, Nov. 2 when patrons can
hear about distinctive brews made
from wheat, barley and oatmeal.
Tickets are $30.
Displaying the beauty of creation,
the Royal Quilt Gallery, in the Upper
East Annex, will feature the
Waterloo County and Area quilt
festival. Highlights include more
than 60 quilts from South Africa,
Nova Scotia, Waterloo Heritage
quilts, Aboriginal and Scandinavian
quilts .
Many popular attractions will
return again this year including the
Cavalcade of Horses. A new
presentation ring will bring a new
look to the show. Attendees will be
able to get a close up look at the
world’s finest breeds with
continuous demonstrations of
reining, vaulting, therapeutic riding
and equine massage.
The animal and vegetable
competitions draw more than 3,000
entrants showing off everything
from the largest pumpkin and tallest
cornstalk to the perfect Holstein or
llama.
The Celebration of the Dog: A
Howlin’ Good Time show, supported
by the Canadian Kennel Club, will
show off the amazing skills of the
performance dogs. There are
numerous special features, including
Doggie Tails which invited children
and their families to share in the
pleasure of doggie rhymes, songs
and stories from around the world.
Continued on page 17
MUNICIPAL ELECTION 2000
(Section 45, Municipal Elections Act, 1996)
MUNICIPALITY OF
CENTRAL HURON
ADVANCE VOTE
will be held on
SATURDAY, NOVEMBER 4
(for the whole municipality)
Bill Siemon for
Deputy Mayor Huron East
- life long resident of
McKillop Township
-19 Years Municipal
Government
Experience
- Member of Huron East
Transition Committee
- Owner/Manager McMaster
Siemon Insurance Brokers Inc.
- Farm, Municipal Drainage &
Construction work experience
I would appreciate your
support on election day.
LOCATION: Clinton Town Hall
TIME: 12:00 noon - 5:00 p.m.
ELECTION DAY
is Monday
NOVEMBER 13,2000
VOTING TIMES: 10:00 am-8:00 pm
VOTING LOCATIONS:
WARD 1: Goderich Township Residents
Goderich Township Hall, Holmesville
WARD 2: Hullett Township Residents,
Londesboro Hall
WARD 3: Town of Clinton Residents,
Central Huron Secondary School, x
165 Princess St. East, Clinton
L. M. Cranston, A.M.C.T.
Election Clerk