Benefits of Incorporating Include:

1. Limited Liability: that is, the personal assets of owners are protected against any legal obligations or corporate debt. So, if the company gets sued then the owner's personal home, vehicles, and investments are safe from creditors and legal responsibility.

2. Lower Tax: Corporations are taxed at a lower rate and if there is less than $10 million in taxable capital employed in Canada, they may be eligible for the small business deduction getting them an even lower tax rate.

3. Deduction of Expenses: Things like meals and entertainment, purchase of equipment or machines, and vehicle costs such as gas, insurance, repairs & maintenance are all expenses that you are able to claim in the business to lower your tax liability.

4. Income Splitting: Businesses can pay family members in lower income tax brackets salary and/or dividends resulting in further tax savings.

5. Loss Carryforward or Carryback: Any losses or negative income can be carried forward (or back to prior tax years) to reduce tax liability. For example, if a business had a loss of $20,000 in 2021 and profits of $50,000 in 2022, they are able to offset the $20,000 loss against the $50,000 profit leaving them $30,000 and all subsequent calculations of tax on this lower amount.