The question is not revenue, it is what stays in
Ontario taxes a corporation's active business profit at about 12.2% on the first $500,000. That rate only helps with money the business keeps: retained profit that will buy the next body, cover the winter, or build toward a studio space. A shooter who spends everything the business makes gets little from the structure, because integration pulls the combined tax on withdrawn income back toward the sole-proprietor result while the corporate return, minute book and separate bank account remain to be maintained.
The honest signals that it is time: booking volume that outruns what you need to live on, an associate or second team shooting under your brand, or a lease and build-out on the horizon. If the answer today is not yet, staying a sole proprietor is a fine decision, and CPA Quick Support at $99 a month keeps a CPA in reach for the questions that come up in the meantime.
Liability: drones, venues and the wedding you cannot reshoot
Photo and video work carries real exposure. A drone incident at a venue, a guest tripping over a light stand, a corrupted card holding the only copy of a ceremony: any of these can become a claim, and a wedding cannot be reshot. A corporation puts business obligations in the company's name rather than yours, which is genuine protection for the house and the savings, though it is the second line of defence. Insurance is the first, and incorporating changes none of the need for general liability, errors and omissions, and a gear policy.
One thing incorporation does not move: your Transport Canada drone pilot certificate is issued to you as a pilot, and it stays personal no matter who owns the aircraft.
Moving the kit in without a tax bill
Years of accumulated bodies, glass and lighting have a depreciated tax value that is usually far below what they cost. Selling them to your new corporation at market value can trigger recapture of the CCA you claimed. A section 85 rollover, filed on Form T2057, transfers the gear at elected amounts instead, so the corporation inherits the kit without a tax event on the way in. The election has a deadline tied to the first returns after the transfer, so this is paperwork done at incorporation, not remembered later.
The rest of the transition is a checklist, and skipping items on it is how new corporations quietly stay sole proprietorships in the CRA's eyes:
| Item | After incorporation |
|---|---|
| HST account | New registration under the corporation's business number |
| Client contracts | Next season's bookings signed in the corporate name |
| Copyright in new work | Owned by the corporation that the contracts name |
| Gear | Rolled in under section 85 at elected amounts |
| Insurance | Policies reissued with the corporation as insured |
| Drone pilot certificate | Stays with you personally |
Two setup choices are easy to get right on day one and annoying to fix later. The corporation does not have to carry your brand in its legal name: a numbered Ontario company with the studio name registered as a business name keeps the brand flexible if you ever add a second one. And unlike a sole proprietor, a corporation picks its own fiscal year-end; setting it in the late-winter lull means counting deposits and closing the books while the calendar is quiet, not in the middle of October's deliveries.
What a corporation will not do for you
It will not automatically split income with a spouse: the TOSI rules tax dividends to family members at top rates unless an exception applies, such as a spouse genuinely working in the business an average of 20 hours a week. It will not lower your tax if you withdraw every dollar, and it will not replace a contract or an insurance policy. What it will do, for the right business, is defer tax on retained profit, contain liability, and give the studio a structure that can one day hold an associate team or a second brand.
Our Incorporation service sets up the Ontario corporation with the share structure planned rather than defaulted, files the elections, and hands off into tax planning for the salary and dividend decisions that follow. We work with photo and video businesses across Mississauga and the GTA, and the first conversation, a 15-minute discovery call, is free.
