Rental properties: Options for investors eyeing new income


When buying a revenue generating residential property, there are multiple ways to structure ownership. Determining the optimal structure must be done on a case-by-case basis. Every investor’s situation is unique, which means there aren’t any one-size-fits-all solutions. There are both advantages and disadvantages to holding a rental property personally versus in a corporation, and many factors need to be considered in order to determine which is more appropriate for your situation.

One of the principal benefits of holding a rental property in a corporation is the limited liability of the corporate shareholder.

“This means that generally, shareholders are not personally liable for any of the corporation’s debt,” said Richard Scheim, principal and chartered professional accountant at Schwartz Levitsky Feldman. “This isn’t the case when a rental property is held personally.”

However, if rental losses are incurred and the corporation has no other income, the losses are generally trapped in the…

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