Can Realtors incorporate in Alberta?
A personal real estate corporation, or PREC, allows a real estate agent to earn their business income through a corporation. Several provinces, including British Columbia, Alberta, Saskatchewan, Manitoba, Quebec, Nova Scotia and, most recently, Ontario, allow PRECs.
What is Prec?
A Personal Real Estate Corporation (PREC) is a personal corporation that real estate agents and brokers can establish.
How is Prec set up in Ontario?
To register for a PREC in Ontario, you must give notice to the RECO (Real Estate Council of Ontario) and have your PREC’s name and address approved. PRECs in Ontario are required to have a business head office address in Ontario. In addition, you must file your Articles of Incorporation.
How do you make Prec?
To set up a PREC, you’ll need to engage a lawyer to create a transfer agreement to transfer your assets from your sole proprietorship into the corporation, as well as to draft and file articles of incorporation and related resolutions.
An affiliated holding company is permitted to own equity shares in your PREC so long as such corporation is structured exactly like your PREC and the Controlling Registrant holds all voting shares and authority.
What are the benefits of a Prec?
The list of “pros” for a PREC include health spending, capital gains exemption, tax deferral, and income splitting.
- Corporate taxes. PRECs can take advantage of corporate tax rates. …
- Health Spending Account. PRECs can set up a Health Spending Account, or HSA. …
- Tax Deferral. …
- Capital gains exemptions. …
- Income splitting. …
Can holding company buy real estate?
A holding company can own shares of a private corporation with active business operations. It can also hold passive assets, such as publically traded securities, bonds, real estate and so on.
Can a Prec have a TFSA?
A corporation means having the option and flexibility of having investments in RRSP, TFSA, and in a corporation as an investment vehicle, as well as using the PREC or a holding corporation to hold rental property investments.
What type of corporation is best for real estate?
The Limited Liability Company (known as LLC) is the best entity for most real estate and mortgage investors who “buy and hold” their investments. When you buy and hold real estate it is considered a capital asset.
Can a Prec be a numbered company?
Unlike professional corporations, there are no requirements that the name of the PREC include any specific words. However, the name shall not suggest that the PREC is trading or dealing in real estate or is a real estate brokerage or team. In that a PREC can be a numbered company.
How do you name a Prec?
For a PREC, it’s best to go with ‘Your first name/first initial, your last name, Professional Real Estate Corporation. ‘ A lawyer can help advise you on appropriate names that are likely to be approved.
What is a real estate holding company in Canada?
What Is A Real Estate Holding Company In Canada? company does not perform any business activity, but it also owns stocks in other companies. It holds shares of another firm and invest its proceeds. You can include it as well as business enterprises, shares in public companies, real estate, stock market securities, etc.