As a medical practitioner, you have the option to incorporate your practice. While incorporation may not be suitable for all medical practitioners, there are several benefits to consider. In this blog post, we’ll explore some of the advantages of incorporation for medical practitioners.
- Limited Liability Protection One of the primary benefits of incorporation is limited liability protection. When you incorporate your medical practice, you create a separate legal entity that can enter into contracts, own property, and sue or be sued. As a result, your personal assets are shielded from any liabilities that may arise in the course of your medical practice. This means that if someone were to sue your medical practice, they would not be able to come after your personal assets to satisfy any judgment.
- Tax Benefits Another benefit of incorporation is the potential for tax savings. When you operate your medical practice as a sole proprietorship or partnership, you are taxed on the income earned by your practice at your personal tax rate. However, when you incorporate, your medical practice becomes a separate taxpayer, which may allow you to take advantage of certain tax deductions and credits that are not available to sole proprietors or partnerships. Additionally, if you decide to pay yourself a salary from your medical practice, you may be able to reduce your overall tax burden by splitting your income between your salary and dividends.
- Increased Credibility Incorporation can also increase your credibility as a medical practitioner. When you operate your medical practice as a corporation, you give the impression that your practice is a larger and more established business. This can help build trust with your patients and suppliers, and may even help attract new patients to your practice.
- Transferability and Succession Planning Finally, incorporation can make it easier to transfer ownership of your medical practice or plan for succession. When you incorporate, you can issue shares of stock that can be sold or transferred to other individuals. This makes it easier to bring in new partners or investors, or to sell your practice outright when you are ready to retire.
In conclusion, there are several benefits to incorporating your medical practice. From limited liability protection to tax savings and increased credibility, incorporation can help take your medical practice to the next level. If you’re considering incorporation, it’s important to work with a lawyer who can help you navigate the process and ensure that your minute book is properly maintained. Contact Falcon Law PC at 1-877-892-7778 or info@falconlawyers.ca for more information.
