Cars and Corporations
Many small business owners ask the perennial question of whether they should own their car within the corporation or personally. There are several factors that go into answering that question, such as:
-how many kms will you drive in the year for personal use and for business use.
-how much will the car cost
-how long will you keep the car
-what is the cost of liability insurance for a car owned by the corporation versus a car owned personally
-what is the cost of collision insurance for a car owned by the corporation versus a car owned personally
-how much collision insurance will you maintain and what will your deductible be
-what is the address of the corporation versus your personal address
-what are the fuel and maintenance costs for the car
-how roughly do you expect to treat it and will there likely be a loss on sale or a gain on sale compared to how much you’ve written it down?
-does the corporation have more than one owner
-what assets does the corporation have versus you, personally?
The question essentially boils down to a tax management element, insurance cost element, and a risk management element to the extent that you choose to self-insure.