COMM-1107EL Chapter Notes - Chapter 10: Reverse Stock Split, Legal Personality, Dividend
12 Mar 2017
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A corp. is a business entity formed under federal or provincial law. The federal or provincial government grants articles of incorporation, which consist of docs giving the governing body"s permission to form a corporation. A corporation is a distinct entity, an artificial person that exists apart from its owners, the shareholders. Corporations have continuous lives, regardless of changes in their ownership: the shareholders of a corporation may transfer shares as they wish. They may sell or trade to another person, give them away, bequeath them in a will, or dispose of them in any other way. Partners and proprietors are personally liable for all the debts of their business (unless it is llp) Since they are separate legal entities, they must pay income taxes separate from those borne by their individual shareholders . Sole proprietors and partners pay individual income taxes based on their share of the business"s income.
