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ARTICLE · 04 NOVEMBER 2014

Why Would Anyone Want An Unlimited Liability Company?

Miller Thomson
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An unlimited liability company is a common entity US businesses use as a Canadian subsidiary or to hold Canadian assets.

CanadaCorporate/Commercial Law
Stephen Rukavina
Stephen Rukavina
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An unlimited liability company ("ULC") is a common entity US businesses use as a Canadian subsidiary or to hold Canadian assets.  This can seem strange.  Normally, a business will incorporate because shareholders do not incur liability for the corporation's debts and liabilities except in exceptional circumstances.  However, the shareholders of a ULC do incur liability for the corporation's debts and liabilities.  Why would anyone want to use a ULC if that is the case?  The reason is that ULCs offer several tax advantages to US shareholders.  Those tax advantages are discussed below after a brief discussion of the use of a branch or subsidiary to carry on business in Canada.

Branch Verse a Canadian Subsidiary

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