On October 1st, 2020, the Provincial government implemented new rules in Ontario allowing Realtors® to form a Personal Real Estate Corporation (PREC). PREC’s allow Realtors® to access the business advantages of incorporation, including tax and income planning benefits.
The Ontario Real Estate Association (OREA) has created a website with resources to assist Members whom are interested in forming a PREC; https://www.orea.com/Political-Advocacy/Personal-Real-Estate-Corporations
A new Agent will need to be added to both Showings and/or Commissions applications as applicable. Personal Real Estate Corporations require a new HST registration number.
In Showings, enter the Personal Real Estate Corporation name in both “Company” & “Does Business As” on the Details tab of the Phone List.
In Commissions, once imported from Showings you simply need to change the Payee = Company and complete the rest of the details as usual.
If you do not integrate with Showings, you will need to set up a new Agent in Commissions.
Please note, if you have paid the agent previously as an individual, be mindful to select the correct name moving forward as Agents will receive a T4A as an individual and a corporation for the calendar year in which they became a corporation. An alternate solution would be to change the status of the Agent to Terminated with the applicable date that they are no longer transacting as an individual. This will drop the name from the list of Active Agents when attaching to transactions and still allow a T4A to generate for commission earned as an individual.
Finally, if integrating with QuickBooks® please remember to change any memorized invoicing, outstanding customer balances, etc. to the new name if required.