Transferring Rental Properties to Corporation

[Mike Grady]

My wife and I have three rental properties in Ontario owned in our own names. Our accountant had initially advised us to do this when we thought we'd only have one or two.  Now we have three and are looking to add more. I am thinking of starting a corporation to hold all of our investment properties, I like the idea for liability reasons and business bookkeeping accounting reasons. I am a business owner, my primary  business is structured as a corporation so I am used to managing things in a corporation umbrella. I know that transferring properties can trigger capital gains taxes and other issues, I intend to hold the properties forever so ideally I would never be paying capital gains taxes on them. Does anyone here have experience transferring personally held investment properties into a corporation? 

[Huong Luu]

Your accountant will be best to guide you through Section 85. You can calculate the capital gains and land transfer tax and other expenses involved prior to doing so. I have a great accountant in Ontario who walked me through this, that I can refer if you want. The other option is to leave these under your own name and going forward put new acquisitions under a corp. You may want to set up a 3-tire structure too.