As well, profits from a sole proprietorship must be added to your personal income. And this may mean you have to pay more tax than would have been the case with an incorporated company. Registered partnerships Registered partnerships, although similar to sole proprietorships, are complicated by the existence of multiple owners. Sometimes, this works well and strengthens the venture. Incorporation Incorporated businesses can often benefit from a number of legal and taxation advantages not available to sole proprietorships or registered partnerships.
Some provinces offer highly favourable tax rates, for example.
However, they can be much more expensive to set up and involve complexities which often require the services of a professional such as a lawyer or an accountant. One major advantage of this form is that it can allow for the continuity of the business when owners die or sell their share of the business. However, there are also disadvantages to incorporation especially for those businesses which are quite small. To begin with, the process of incorporation can be difficult, complicated and expensive. Incorporation requires that you get a search firm to verify that your business name is not already in use.