Income Tax Using Limited Company in Canada

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Subject: Income Tax Using Limited Company in Canada
  Some agents are in touch with me and are advising that I could start work through them for Engineering Consultancy and with this the Canadian Income Tax would be 15% only. Plus CPP and EI, the total taxation, CPP and EI liability put together works out to be much less than 20%.
Whilst working as Staff, the total taxation could be in the marginal range of 39% (29% marginal tax as federal tax and 10% as Alberta tax)

Could some one provide two calculations for

Working as staff with annual earning of $ 120,000
Working as Contract Staff using Limited Company annual earning of $ 120,000

What are the amount of CPP, EI etc. in both these cases?

Thanks to all you share their views.

Regards


[31-05-2008,08:08]
[**.62.225.3]
PPG
(in reply to: Income Tax Using Limited Company in Canada)
Your question is lacking some logic.

It does not matter that you incorporate yourself or not.

Anyone should know if you are self employed their are advantages and disadvantages.

You may be able to write off the vast majority of expenses so contact an accountant who is a CGA.
For example if you fix permanent advertisement to any vehicle you can write off all payments of that vehicle if you want to drive around with "Joe Blow Engineering Co." on your vehicle.

It seems you want the benefits but are focused on being penny wise and pound foolish.

Roy
www.cvimmigration.com

[31-05-2008,09:37]
[**.52.216.11]
Roy
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