Dentists and dental surgeons across Hamilton, the GTA, Ontario, and Canada can gain major tax and planning advantages by incorporating their dental practice. However, a Dental Professional Corporation must comply with strict legal and regulatory rules under Ontario law and the Royal College of Dental Surgeons of Ontario (RCDSO).
At Momentum Accounting CPA Professional Corporation, we help dentists incorporate, structure, and optimize their professional corporations in a fully CRA‑compliant and tax‑efficient manner.
Why Dentists Incorporate?
If you operate as a sole proprietor, your dental income can be taxed at up to 53.53% in Ontario. By incorporating as a Canadian‑Controlled Private Corporation (CCPC), you unlock powerful benefits.
Key Tax Advantages
1. Lower Corporate Tax Rate
Ontario small business tax rate: ~12.2% vs. personal rates up to 53.53%.
2. Income Splitting
Pay reasonable salaries or dividends to a spouse, adult children, or parents (subject to TOSI rules).
3. Flexible Pay (Salary vs. Dividends)
Optimize personal tax, CPP, RRSP room, and corporate deductions.
4. Lifetime Capital Gains Exemption (LCGE)
Over $1,000,000 (indexed) tax‑free on sale of shares of a Qualified Small Business Corporation (QSBC).
5. Estate & Succession Planning
Use estate freezes and family trusts for tax‑efficient intergenerational transfers.
Legal Requirements for a Dental Professional Corporation (Ontario)
Your corporation must comply with:
Ontario Business Corporations Act (OBCA)
Regulated Health Professions Act (RHPA)
RCDSO regulations
1. Ownership Rules
Voting shares: owned only by RCDSO members
Non‑voting shares: may be owned by spouse, children, or parents
2. Articles of Incorporation
Only dentistry and ancillary activities permitted
Voting rights cannot be transferred to non‑dentists
3. Name Rules
Must include “Professional Corporation.”
Must include dentist’s surname
Must indicate the profession (Dentistry)
Example: Dr. Patel Dentistry Professional Corporation
4. Directors & Officers
Must be shareholders and RCDSO members
5. RCDSO Certificate of Authorization
Required before practicing through the corporation. Includes:
Application fee
Articles of Incorporation
Corporation Profile Report
Statutory Declaration (OBCA compliance)
Shareholder, director, and office details
Liability: Common Misconceptions
A professional corporation does NOT protect against malpractice claims. Dentists remain personally liable for clinical negligence.
It DOES help protect against:
Business creditors
Equipment loans
Lease obligations
(subject to personal guarantees)
Director’s Liability
Directors may be personally liable for:
Unremitted payroll deductions
Unremitted GST/HST
Certain environmental liabilities
Director’s liability insurance is strongly recommended.
Conclusion
Incorporating a dental practice offers major tax and retirement planning advantages—but mistakes can cause:
RCDSO authorization refusal
CRA penalties
Loss of LCGE eligibility
Future sale complications
Work With a Dentist CPA in Hamilton
At Momentum Accounting CPA Professional Corporation, we specialize in:
Dental professional corporation incorporations
RCDSO compliance
Tax‑efficient share structures
Compensation planning
Estate freezes & succession planning
LCGE planning & CRA compliance
📍 Serving Dentists Across
Hamilton | GTA | Ontario | Canada
📞 Contact Momentum Accounting CPA Professional Corporation
Dentist CPA – Hamilton, Ontario
📧 info@momentumaccountingcpa.ca
📞 905‑869‑0000
🌐 www.momentumaccountingcpa.ca
Thinking of Incorporating Your Dental Practice?
Book a free consultation with a CPA who understands dentists, RCDSO rules, and CRA tax planning.
👉 Contact Momentum Accounting CPA Professional Corporation today.
