AFFORDABLE IT Consultant Incorporation, Filed by a CPA Firm

Incorporate as an IT Consultant in Canada for $35

Start your IT consulting or software development corporation for $35, HST included. Government fees are separate. A CPA reads your contracts for personal services business risk and sets up HST before we file.

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Complete the Incorporation Intake Form See Pricing

IT consulting and software development are not regulated professions, so you incorporate an ordinary business corporation, either federally under the Canada Business Corporations Act or provincially under the Business Corporations Act (Ontario). We prepare and file it for $35.00, HST included, and show each registry charge at the government’s own figure. Open Corporation for $35 is a department of Gondaliya CPA.

The question that decides whether incorporating pays is not the filing. It is whether the Canada Revenue Agency would treat your company as a personal services business, an incorporated employee, which loses the small business rate. A Chartered Professional Accountant reads your contracts and your client mix before the articles are filed.

AFFORDABLE Incorporation for IT Consultants and Software Developers

Banks, insurers, governments and the large staffing agencies that supply them often contract only with a corporation. If you want the contract rate rather than a T4, you usually need a company first.

Active business income within the $500,000 federal business limit is taxed at 9% federally and 3.2% in Ontario, a combined 12.2%. A consultant billing $180,000 and living on $100,000 leaves the difference in the company at that rate.

That rate only holds while the company is a real business. If it looks like an employee with a corporate name, the combined rate in Ontario rises to 44.5% and most deductions disappear, so the structure has to be right from the first contract.

Start for $35 See Pricing

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Equipment in the company

Laptops and servers go in Class 50 at 55%, and purchased software in Class 12 at 100%, claimed by the corporation against income taxed at 12.2%.

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Clients outside Canada

Services to a non-resident client are generally zero-rated for HST, and a US client will ask for a W-8BEN-E in the company’s name before paying.

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Building a product

Software development that resolves a real technological uncertainty can earn the 35% refundable SR&ED credit, available only to a Canadian-controlled private corporation.

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Rules That Apply When You Incorporate as an IT Consultant

There is no professional corporation, college or licence for IT work in Canada, and no rule on who may hold shares. The rules that matter come from the Income Tax Act, the Excise Tax Act and, for some consultants, immigration law.

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Personal services business

Under subsection 125(7) of the Income Tax Act, a corporation is a personal services business where its worker would reasonably be regarded as an employee of the client but for the corporation, unless it employs more than five full-time people.

It loses the small business deduction, pays an extra 5% federal tax, and section 18(1)(p) limits deductions to salary and a few others.

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Federal or Ontario

A federal corporation costs $200 at Corporations Canada, protects the name across Canada and suits a consultant working for clients in several provinces. It must also register in Ontario, and a quarter of its directors must be resident Canadians. An Ontario corporation costs $300.

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Agencies and contracts

Staffing agencies usually contract corporation to corporation and pay invoices without deductions. The contract terms, who controls the work, who supplies the tools, and whether you can work for others, are what the CRA reads.

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HST registration

Once taxable supplies pass $30,000 over four consecutive calendar quarters, the corporation registers and charges 13% to Ontario clients. Services to non-resident clients are generally zero-rated.

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Work permits

Anyone may own shares, but owning a corporation is not permission to work. A consultant on an employer-specific work permit cannot work for their own company without the right authorization, which is a question for an immigration professional.

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Annual filing

An Ontario corporation files the Ontario Annual Return within six months of year end. A federal corporation files its annual return with Corporations Canada within 60 days after its anniversary, for $12.

Typical Share Structure for an IT Consulting Corporation

Share class	Who holds it	Voting	Dividend entitlement	Why it is there
Class A common	The consultant	Yes	Discretionary	Control of the company and its contracts
Class B common	A co-founder or second developer	Yes	Discretionary	Two people building one business
Class C non-voting common	A spouse working in the business	No	Discretionary	Dividends where a TOSI exception applies
Class D preferred	An investor or the founder	No	Fixed, redeemable	Seed money, or a value freeze before growth
Class E common	A holding company	Yes	Discretionary	Surplus moved out of the operating company

Section 120.4 of the Income Tax Act decides whether the Class C shares can be paid anything. The excluded shares exception fails where 90% or more of business income comes from services, which is almost always the case for a consulting company. What remains is the excluded business test, an average of at least 20 hours a week in the business, and the rule that frees dividends to a spouse once the owner turns 65.

A software company selling licences or subscriptions rather than hours can be in a different position, so a CPA tests the revenue mix before any family dividend.

HST for IT Consultants and Software Developers

Consulting, programming and software services are taxable. A service supplied to a client in Ontario carries 13% HST, a client in another province is charged that province’s rate, and a client outside Canada is generally charged nothing.

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When to register

Registration is compulsory once taxable supplies, including zero-rated ones, pass $30,000 over four consecutive calendar quarters or in a single quarter. Agencies usually expect an HST number on the first invoice.

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The quick method

A consultant with few costs often does better on the quick method: you charge 13% and remit 8.8% of HST-included Ontario sales, with a 1% credit on the first $30,000, and still claim credits on capital purchases. It is open below $400,000 of annual taxable supplies.

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Non-resident clients

Services supplied to a non-resident client are generally zero-rated under Part V of Schedule VI to the Excise Tax Act. The exceptions, such as services delivered to an individual while in Canada, are checked contract by contract.

Common CRA Issues for IT Consulting Corporations

Personal services business reassessment

Triggered by one client for several years, a client laptop and email address, set hours and a manager who directs the work. The small business deduction is denied and the combined Ontario rate becomes 44.5%.

HST never charged

Triggered by a contractor who passed $30,000 and kept invoicing without HST. The CRA assesses the tax that should have been collected, usually out of your own margin.

Cash drawn as a shareholder loan

Triggered by withdrawals with no salary or dividend declared. A balance still owing a year after the company’s year end is added to your income under subsection 15(2).

Spouse dividends with no exception

Triggered by a T5 to a spouse who does no work in the business. A consulting company cannot use the excluded shares exception, so the dividend is taxed at the top rate.

Personal costs as business expenses

Triggered by a family car, home renovations or holidays booked as conference travel. Personal use is a shareholder benefit under subsection 15(1).

The normal reassessment period for a CCPC is three years under subsection 152(3.1); paragraph 152(4)(a) removes it for misrepresentation from carelessness or wilful default.

First-Year Compliance Calendar

When	What is due	Who files it	What happens if it is late
Before the contract is signed	Corporation incorporated and named as the contractor	Us, Corporations Canada or the Ontario Business Registry	The agency pays you personally, or the start date slips
Week 1	Business number, RC0001 and RT0001 HST accounts	Your CPA, with the CRA	No HST number for the first invoice
Before the first US invoice	Form W-8BEN-E in the corporation’s name	The corporation, to the client	US withholding on payments, or payment held
Within 60 days of incorporation	Ontario Initial Return, for an Ontario corporation or a federal one registering in Ontario	Us, Ontario Business Registry	Non-compliance. No fee
Before the first salary	RP0001 payroll account	Your CPA, with the CRA	Nothing to remit deductions against
15th of each month	Payroll source deductions on your salary	The corporation, to the CRA	Penalty of 3% to 10%, 20% on a repeat
One month, three months or a year after each period	HST return, by filing frequency	Your CPA, with the CRA	Late filing penalty and interest
Within 53 weeks of incorporation	First fiscal year end chosen	Your CPA	Hard to change once the first T2 is filed
Last day of February	T4 and T5 slips for salary and dividends	Your CPA, with the CRA	Late filing penalty per slip
3 months after year end	Part I tax balance for a CCPC	The corporation, to the CRA	Interest from the day after
6 months after year end	T2 return and Ontario Annual Return	Your CPA, and us	Late penalty, then cancellation of the corporation
Within 60 days after the anniversary	Federal annual return, $12, for a federal corporation	Us, Corporations Canada	Dissolution after repeated defaults

Before Anything Is Filed

What a CPA Checks Before You Incorporate

Start Your Intake Form

We start with your clients and your contracts, because they decide whether the corporation is a business or an incorporated employee.

Jurisdiction, HST, pay and the year end follow.

Check 1

Your client mix

One long engagement through an agency looks very different from several clients, your own website and your own equipment.

Check 2

The contract terms

Control, tools, substitution, the right to work for others and how you are paid, read against the personal services business test.

Check 3

Federal or Ontario

Where your clients are, whether the name needs national protection, and whether the directors meet the federal residency rule.

Check 4

HST setup

Registration date, filing frequency and whether the quick method saves money on your margin.

Check 5

Foreign clients

Zero-rating, the W-8BEN-E for US clients, a US-dollar account, and whether any work is done while physically in the US.

Check 6

How you pay yourself

Salary for RRSP room and CPP, dividends for flexibility, and the TOSI position of any family shareholder.

Check 7

Products and SR&ED

Whether you are building software of your own, and keeping the records an SR&ED claim needs from the first sprint.

Check 8

Status and year end

Your immigration status where relevant, and a fiscal year end that suits your contract cycle.

AFFORDABLE Incorporation Pricing for IT Consultants

Our fee is $35.00 with HST included. Government filing fees are passed through at cost with no mark-up, and every total below is final.

Ontario Provincial Incorporation

Service	Final Fee	Frequency
Ontario named corporation – Government filing CAD 300 + NUANS CAD 25 + our incorporation fee CAD 35	CAD 360	One-time
Ontario numbered corporation – Government filing CAD 300 + our incorporation fee CAD 35	CAD 335	One-time
Our professional incorporation fee component	CAD 35	One-time
NUANS name search	CAD 25	One-time
Annual Virtual Registered Address Service Package	CAD 900	Annual

Federal Incorporation – Based in Ontario

Service	Final Fee	Frequency
Federal named corporation based in Ontario – Government filing CAD 200 + NUANS CAD 38 + our incorporation fee CAD 35	CAD 273	One-time
Federal numbered corporation based in Ontario – Government filing CAD 200 + our incorporation fee CAD 35	CAD 235	One-time
Our professional incorporation fee component	CAD 35	One-time
Federal NUANS name search based in Ontario	CAD 38	One-time
Annual Virtual Registered Address Service Package	CAD 900	Annual

See Full Pricing

Our Services for IT Consultants and Software Developers

Our professional fees include HST. Government fees are separate, itemised and charged at cost with no mark-up.

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NUANS Report for IT Consultants

The name search a named consulting or software company needs, Ontario or federal, with your choices screened before one is bought. A numbered company needs none.

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Incorporation Service for IT Consultants

Articles drafted for you, a co-founder or a future investor, with the corporation in place before the agency contract or the first client invoice.

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Address Service for IT Consultants

A registered office address in downtown Toronto, so a remote consultant’s home address stays off the public register and client contracts carry a business address.

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Payroll Service for IT Consultants

The payroll account for your own salary, source deductions worked out each pay run, and T4 slips filed before the February deadline.

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One Window Service for IT Consultants

The articles, the business number, the HST and payroll accounts and the first year of filings handled through one person, so the first invoice goes out on time.

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Corporate Annual Filing for IT Consultants

The Ontario Annual Return or the federal annual return filed on time, with director and address changes reported, so agency compliance checks pass.

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Corporate Tax Filing for IT Consultants

The T2 with GIFI statements, equipment in the right capital cost allowance classes, and salary and dividends reconciled to the T4 and T5 slips.

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Federal Incorporation for IT Consultants

A federal corporation for a consultant with clients across Canada, with the name protected nationally and the director residency rule checked before filing.

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Holding Company Setup for IT Consultants

A holding company that takes surplus cash out of the operating company, away from client and contract risk, with the $500,000 limit shared deliberately.

The Bundle for IT Consultants

After incorporation the accounting moves to the parent firm. Gondaliya CPA keeps the books, issues and tracks invoices, files the HST returns on the method that suits your margin, runs payroll for your salary, prepares the T2 and the annual return, sets the salary and dividend mix each year, reviews new contracts for personal services business risk, and prepares SR&ED claims for software you build.

Gondaliya CPA for IT Consultants Incorporation for IT Consultants

Why IT Consultants Use Us

Gondaliya CPA IT consultant incorporation team

Gondaliya CPA Professional Corporation is registered with CPA Ontario under firm registration number 61330051. Open Corporation for $35 is a department of Gondaliya CPA.

CPA Ontario firm registration number 61330051
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Free CPA Consultation for IT Consultants

Case Studies: IT Consultant Incorporation

Three Ontario technology files, each showing where the consultant started and what changed before anything went to the registry.

Toronto Developer – Two Years at One Bank Through One Agency

The problem: A Toronto Java developer had been placed at the same bank for two years through a staffing agency, on the bank’s laptop and the bank’s hours, and was about to incorporate because the agency asked for a corporation. His plan was to leave everything in the company at 12.2%.

What we did: We incorporated a numbered Ontario company and walked through the personal services business test against his actual contract. He renegotiated the right to take other work, moved to his own equipment, and kept a second, smaller client, and we set a salary to reduce what would be exposed if the CRA disagreed.

The result:

Numbered Ontario corporation filed at $335.00
PSB risk documented against the contract
Salary set to limit exposure

Mississauga Consultant – US Clients Billed With HST

The problem: A Mississauga cloud architect worked remotely for three US companies and one Toronto client. She had been adding 13% HST to every invoice, her US clients were refusing to pay it, and one of them had started withholding 30% because no tax form was on file.

What we did: We incorporated federally for name protection, registered for HST, and zero-rated the services to non-resident clients while charging 13% to the Toronto client. We prepared the W-8BEN-E in the corporation’s name, opened a US-dollar account and moved her to the quick method.

The result:

Federal corporation filed at $235.00
US invoices at 0%, Ontario invoice at 13%
W-8BEN-E on file with each US client

North York Founders – A SaaS Product and No Records

The problem: Two developers in North York were building a scheduling platform at night and planned to incorporate once they had revenue. They were solving hard problems in real-time sync but keeping no record of what they tried, and had agreed to split ownership on a handshake.

What we did: We incorporated with two voting classes and a preferred class for a future angel investor, kept the company Canadian-controlled, and set up a simple SR&ED log of hypotheses, experiments and results from the first sprint. Their equipment and software went into the company’s capital cost allowance classes.

The result:

Ownership set out in the share classes
CCPC status protected for SR&ED
Experiment records kept from day one

Start Your IT Consulting Corporation

Our Simple Process

How You Incorporate as an IT Consultant

Start for $35

Six steps from the intake form to a corporation that can sign the agency contract and send its first invoice with an HST number on it. You always know what is with us, what is with the registry and what comes next.

Nothing is filed until you approve the draft.

Step 1

Send the intake form

Owners, shares, where your clients are, whether you work through an agency, and your contract start date. It takes about ten minutes.

Step 2

A CPA reviews the file

Personal services business risk, federal or Ontario, HST method, foreign clients and the year end. Questions come back the same working day.

Step 3

Numbered or named

A numbered company needs no search. A named one needs a NUANS report, $25 for Ontario or $38 federally, and we screen your choices before paying for one.

Step 4

You approve the draft

You see the articles, the share classes, the directors and the registered office before anything is submitted. Changes cost nothing at this stage.

Step 5

Filed online

Federal articles go through Corporations Canada and Ontario articles through the Ontario Business Registry. An online filing is processed on submission and the certificate is emailed to you.

Step 6

Ready to invoice

The business number with HST and payroll accounts, the Ontario registration for a federal company, the W-8BEN-E for US clients, and the minute book.

Meet the Lead CPAs Behind Your IT Consulting Corporation

A Chartered Professional Accountant checks your contracts, the personal services business risk and the HST setup before anything is filed.

Sharad Gondaliya, CPA

Principal

Bio

647-212-9559

Vandana Goel, CPA

Accounting Specialist

Bio

647-250-0242

What Our Clients Say

These Google reviews belong to Gondaliya CPA Professional Corporation and cover every service the firm provides. See all reviews.

Incorporating as an IT Consultant Anywhere in Canada

We incorporate IT consultants and developers from thirteen Ontario offices and remotely across Canada. The filing is electronic, so no visit is needed. A federal corporation can be filed for a consultant in any province, and a provincial one where that suits better, with the registry fee confirmed in writing first.

Ontario cities with an office

IT consultant incorporation inToronto IT consultant incorporation inMississauga IT consultant incorporation inBrampton IT consultant incorporation inScarborough IT consultant incorporation inNorth York IT consultant incorporation inEtobicoke IT consultant incorporation inHamilton IT consultant incorporation inOttawa IT consultant incorporation inOshawa IT consultant incorporation inWindsor IT consultant incorporation inGuelph IT consultant incorporation inVaughan

Cities we serve remotely

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IT Consultant Incorporation FAQs

How much does it cost to incorporate as an IT consultant in Canada?

A numbered federal corporation costs $235.00 in total: $200.00 to Corporations Canada and our $35.00 fee with HST included. A named federal corporation adds a $38.00 federal NUANS report, for $273.00. An Ontario corporation costs $335.00 numbered or $360.00 named, because the Ontario Business Registry charges $300.00 and the Ontario-biased NUANS report is $25.00. Those totals are final for the incorporation itself. A federal corporation that works in Ontario also files an extra-provincial registration in Ontario, and files a $12.00 federal annual return each year. If you want your home address off the public register, the virtual registered address package is $900.00 a year. Bookkeeping, HST returns, payroll and the T2 are quoted separately by Gondaliya CPA, and the T2 starts from $300. There is no licence or college fee, because IT consulting is not a regulated profession in Canada.

Should an IT consultant incorporate federally or in Ontario?

Either works, and the choice turns on where your clients are and how much the name matters. A federal corporation under the Canada Business Corporations Act costs $200.00 to file, protects the corporate name across Canada and suits a consultant with clients in several provinces or plans to build a product brand. It must also register in each province where it carries on business, including Ontario, and at least a quarter of its directors must be resident Canadians. An Ontario corporation costs $300.00 to file, has no director residency rule and is simpler when you live and work in Ontario. The tax result is the same either way: a corporation pays tax in the province where it has its permanent establishment, not under the statute it was formed under. Many agency consultants choose a numbered Ontario company; consultants with a brand or national clients often choose federal. We look at both before filing.

What is a personal services business?

It is the Income Tax Act’s name for an incorporated employee. Under subsection 125(7), a corporation carries on a personal services business where the individual who does the work would reasonably be regarded as an officer or employee of the client if the corporation did not exist, and the corporation does not employ more than five full-time employees throughout the year. The CRA applies the usual employment tests to the real relationship: who controls how and when the work is done, who supplies the tools and equipment, whether you can hire helpers or substitutes, whether you carry any financial risk or chance of profit, and how integrated you are in the client’s organization. The consequences are severe. Income from a personal services business does not get the small business deduction, pays an extra 5% federal tax, and in Ontario is taxed at about 44.5% combined, while section 18(1)(p) limits deductions to salary paid to you and a few other items.

How do I reduce the personal services business risk?

By making the business genuinely look like a business, because the CRA looks at the facts rather than the wording of the contract. The strongest factors are working for more than one client, or being free to, and actually marketing your services; supplying your own computer, software and workspace; controlling how and when you deliver the work; being able to send a substitute or hire help; quoting fixed prices for deliverables rather than only billing hours; and carrying your own risk, such as unpaid invoices or your own insurance. A long single engagement on the client’s equipment, with set hours and a manager directing you, points the other way. Paying yourself a salary also limits the exposure, because salary is deductible even in a personal services business. We read your contract and working arrangement before you incorporate, and tell you plainly if the facts point to an incorporated employee.

Do staffing agencies require IT consultants to incorporate?

Many do. Agencies placing contractors with banks, insurers, telecom companies and governments often contract only with a corporation, paying its invoices without deductions and leaving the corporation responsible for its own tax, HST and payroll. Some will also contract with a sole proprietor, and some offer a T4 employment option at a lower rate. An agency contract usually names the corporation as the supplier, requires an HST number, and sometimes asks for proof of incorporation, a certificate of status and insurance before the start date. The agency’s requirement does not settle the tax question: the CRA can still find that the work is a personal services business, because the test looks at the real relationship with the end client rather than the paperwork with the agency. We incorporate in time for the contract and review its terms before you sign, so you know which option leaves you better off.

Do IT consultants charge HST?

Yes, once the corporation is registered. Consulting, programming, development and support services are taxable supplies. A corporation must register once its taxable supplies, including zero-rated ones, pass $30,000 over four consecutive calendar quarters or in a single quarter, and many consultants register from the first day because agencies expect an HST number on the first invoice. The rate depends on where the client is: 13% for a client in Ontario, the harmonized rate for a client in another HST province, 5% GST for a client in a GST-only province, and generally 0% for a client outside Canada. Registering also lets the corporation recover the HST it pays on a new laptop, software, a phone and other costs. The HST collected belongs to the government, so it should be kept separately rather than treated as income, and returns are filed monthly, quarterly or annually depending on the corporation’s sales.

Should my IT consulting corporation use the HST quick method?

Often yes, if your costs are low. Under the quick method the corporation still charges 13% to Ontario clients but remits only a fixed percentage of its HST-included sales, 8.8% for a service business in Ontario, with a 1% credit on the first $30,000 of eligible supplies each year. It keeps the difference, which is income to the corporation. In exchange it gives up input tax credits on ordinary expenses, although it can still claim the HST on capital purchases such as computers. For a consultant whose main cost is their own time, the quick method usually leaves more money than the regular method. It is available where annual worldwide taxable supplies are $400,000 or less, and it is elected on Form GST74. Sales to non-resident clients that are zero-rated are not included in the calculation. We compare both methods on your expected numbers before electing.

Do I charge HST to clients in the United States or overseas?

Generally no. Services supplied to a non-resident client are zero-rated under Part V of Schedule VI to the Excise Tax Act, so you charge 0% while still claiming credits on related costs. There are exceptions: services supplied to an individual while they are in Canada, services relating to real property or goods in Canada, and some advisory services. On the United States side, a US client will ask for Form W-8BEN-E in the corporation’s name. Without it, the client may withhold 30% of each payment. Work done while physically in Canada is generally not US-source income, but working while physically in the United States can create US tax and immigration issues, so travel for client work should be planned first. A US-dollar bank account avoids repeated conversion, and foreign currency balances are revalued at year end in the books.

Can software development qualify for SR&ED tax credits?

Yes, when it involves real experimental development rather than routine programming. The federal scientific research and experimental development credit for a Canadian-controlled private corporation is 35% of qualifying expenditures up to the annual expenditure limit, and it is refundable, so it is paid even when the company has no tax to pay. Ontario adds its own credits. Software work qualifies when it tries to resolve a technological uncertainty that standard practice and available knowledge cannot answer, through a systematic process of hypotheses, tests and results. Building features with known tools, configuring existing platforms or fixing ordinary bugs does not qualify on its own. Client consulting work, where the client owns the result and pays you regardless, is usually not your corporation’s SR&ED. The claim is filed on Form T661 within 18 months of the year end, and the records of what you tried should be kept from the first sprint.

Should I pay myself a salary or dividends?

Usually a mix, and the right mix depends on your goals. Salary is deductible to the corporation, creates RRSP contribution room and builds Canada Pension Plan benefits, but it requires a payroll account, monthly remittances and CPP contributions from both sides. If you own more than 40% of the voting shares, your salary is generally not insurable employment, so no EI premiums are deducted. Dividends need no payroll, are paid from after-tax corporate profit, and carry a dividend tax credit, but they create no RRSP room or CPP. For a consultant with personal services business risk, salary has a further advantage: it remains deductible even if the CRA reclassifies the business, which reduces what is exposed. Money taken without declaring either becomes a shareholder loan, which is added to your income if it is not repaid within a year after the company’s year end. We model the mix each year.

Can I pay my spouse dividends from my IT consulting corporation?

Only where an exception to the tax on split income in section 120.4 of the Income Tax Act applies; otherwise the dividend is taxed at the top personal rate. The excluded shares exception fails where 90% or more of the business income comes from services, which describes almost every consulting company, so it rarely helps. The excluded business exception remains: a spouse or adult child who works in the business an average of at least 20 hours a week during the year, or in any five earlier years, can receive dividends outside the rules. Once the owner turns 65, dividends to a spouse are generally excluded as well. A spouse who does real work, such as bookkeeping, sales or project management, can also be paid a reasonable salary through payroll. A software company earning mainly licence or subscription revenue rather than service fees may be in a different position, which we test before any dividend is declared.

Can I incorporate in Canada while on a work permit?

You can usually own a Canadian corporation, but owning one does not give you permission to work for it. Anyone, including a non-resident, can be a shareholder, and an Ontario corporation has no director residency rule, while a federal corporation needs at least a quarter of its directors to be resident Canadians. Working is a separate question governed by immigration law. A consultant on an employer-specific work permit is authorized to work only for the employer and in the role named on the permit, so doing contract work through their own corporation is generally not allowed. An open work permit or permanent residence usually gives more room. Because the consequences of unauthorized work can be serious, the work permit question should be answered by a licensed immigration professional before you incorporate or sign a contract. We handle the corporate and tax side once your status is confirmed.

What can my IT consulting corporation deduct?

Ordinary costs of earning the business income: computers and servers in Class 50 at 55%, purchased software in Class 12 at 100%, subscriptions and cloud services, a business phone and internet, professional liability insurance, training and certifications, accounting fees, and a reasonable share of a home office where it is your principal place of business or used regularly to meet clients. Travel to client sites and conferences is deductible where it is for the business, and a vehicle used for business is deductible in proportion to business kilometres, with logs to prove it. Salary paid to you and to family members who genuinely work in the business is deductible at a reasonable rate. If the corporation is a personal services business, section 18(1)(p) limits deductions to salary and benefits paid to the worker and a few other items, which is another reason to settle that question first.

Related Industries We Serve

Management Consultants

Personal services business test
HST quick method
Salary and dividend mix

SaaS and Software Start-Ups

SR&ED records and claims
Investor share classes
Subscription revenue timing

E-commerce and Exporters

Zero-rated foreign sales
US-dollar accounts
Cross-border paperwork

Engineering and Technical Consultants

Agency contracts
Equipment and CCA
Federal incorporation

Incorporate Before Your Next Contract

One form puts a corporation in place before the agency contract or the first client invoice. Pay $35 including HST, and a CPA checks the PSB risk, the HST setup and the shares first.

Complete the Intake Form Book Free Consultation

No legal advice. Gondaliya CPA Professional Corporation is a firm of Chartered Professional Accountants licensed by CPA Ontario, firm registration number 61330051. It is not a law firm. We prepare and file corporate documents and we provide accounting and tax advice. Nothing on this page is legal advice, and reading it creates no solicitor and client relationship. For legal advice, including advice on a client contract, an agency agreement or a shareholder agreement before you sign it, consult a lawyer licensed in the province where your corporation carries on business.

Incorporate as an IT Consultant in Canada for $35

AFFORDABLE Incorporation for IT Consultants and Software Developers

Equipment in the company

Clients outside Canada

Building a product

Our Official Partners

Rules That Apply When You Incorporate as an IT Consultant

Personal services business

Federal or Ontario

Agencies and contracts

HST registration

Work permits

Annual filing

Typical Share Structure for an IT Consulting Corporation

HST for IT Consultants and Software Developers

When to register

The quick method

Non-resident clients

Common CRA Issues for IT Consulting Corporations

Personal services business reassessment

HST never charged

Cash drawn as a shareholder loan

Spouse dividends with no exception

Personal costs as business expenses

First-Year Compliance Calendar

What a CPA Checks Before You Incorporate

Your client mix

The contract terms

Federal or Ontario

HST setup

Foreign clients

How you pay yourself

Products and SR&ED

Status and year end

AFFORDABLE Incorporation Pricing for IT Consultants

Ontario Provincial Incorporation

Federal Incorporation – Based in Ontario

Our Services for IT Consultants and Software Developers

The Bundle for IT Consultants

Why IT Consultants Use Us

Free CPA Consultation for IT Consultants

Case Studies: IT Consultant Incorporation

Toronto Developer – Two Years at One Bank Through One Agency

Mississauga Consultant – US Clients Billed With HST

North York Founders – A SaaS Product and No Records

How You Incorporate as an IT Consultant

Send the intake form

A CPA reviews the file

Numbered or named

You approve the draft

Filed online

Ready to invoice

Meet the Lead CPAs Behind Your IT Consulting Corporation

Sharad Gondaliya, CPA

Vandana Goel, CPA

What Our Clients Say

Incorporating as an IT Consultant Anywhere in Canada

IT Consultant Incorporation FAQs

How much does it cost to incorporate as an IT consultant in Canada?

Should an IT consultant incorporate federally or in Ontario?

What is a personal services business?

How do I reduce the personal services business risk?

Do staffing agencies require IT consultants to incorporate?

Do IT consultants charge HST?

Should my IT consulting corporation use the HST quick method?

Do I charge HST to clients in the United States or overseas?

Can software development qualify for SR&ED tax credits?

Should I pay myself a salary or dividends?

Can I pay my spouse dividends from my IT consulting corporation?

Can I incorporate in Canada while on a work permit?

What can my IT consulting corporation deduct?

Related Industries We Serve

Management Consultants

SaaS and Software Start-Ups

Engineering and Technical Consultants

Incorporate Before Your Next Contract

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