Using the incorporation estimator

"Should I incorporate?" is one of the most common questions a growing sole proprietorship runs into. The incorporation estimator in GBooks Air gives you real numbers to bring into that conversation. Here's how to use it well.

Step 1: Get a full year of clean data in first

The estimator is only as good as the profit figure behind it. Run it against a year with fully categorized transactions and a completed month-end close routine — a partial or messy year will mislead more than it helps.

Step 2: Open the estimator

You'll find it under Reports → Incorporation estimator. It pulls your actual net profit for whatever period you select and models the tax treatment on both sides:

• As a sole proprietor — profit taxed at your personal marginal rate, combined with whatever else you earn.
• As a corporation — profit taxed at the small business corporate rate inside the company, with a separate calculation for what happens when you actually draw money out personally, whether as salary or dividends.

Step 3: Read the output as a starting point, not an answer

The comparison is genuinely useful for spotting the order of magnitude — whether incorporating might save something meaningful for you specifically, or barely move the needle at all. What it deliberately leaves out:

• Incorporation and ongoing annual accounting costs
• Legal and administrative overhead
• Liability protection, which is often the actual reason to incorporate regardless of what the tax math says
• Your specific province's exact rate schedule and any credits or programs you might qualify for

Step 4: Bring the output to your accountant

The estimator's job is to make that conversation faster and more concrete: "here's what my last twelve months looked like, here's roughly what the estimator shows." It's not meant to replace the conversation itself. Reach out to GSH Financial if you'd like to talk through the numbers properly.