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Alberta's leading economy has been built on its commitment to encouraging business and to fostering an environment of success. As our economy evolves, it is important that Alberta maintains its commitment to business and maintains its competitiveness. Over the past several years Alberta has fallen behind Canada's other provinces in fostering the business competitiveness of its highly educated, trained and successful Professionals.
Alberta is home to some of Canada’s leading Professionals. Our Doctors, Dentists, Engineers, Accountants and Lawyers provide a high level of expertise and service to Albertans. On November 24, 2009 the Alberta Legislature passed Bill 53, the Professional Corporations Statutes Amendment Act, 2009 to finally acknowledge that Alberta Professionals have been at a disadvantage when it comes to their business structure and planning opportunities.
Alberta’s rules governing the ownership of shares, both voting and non-voting of professional corporations have differed materially from those of other provincial jurisdictions including those of British Columbia, a signatory of the Trade, Investment, and Labour Mobility Agreement.
The Professional Corporations Statutes Amendment Act, 2009 takes steps to correct the limited tax planning options of the professional. While Alberta claims its “Advantage” in lower overall tax rates, having artificial limits on the tax planning opportunities afforded to its professionals greatly limits that advantage.
Much like the ownership restrictions that had limited planning opportunities for professional corporations, the rules in Alberta for Investment Advisors differ from those of British Columbia, where an Investment Advisor can receive compensation to their personally owned corporation.
Life Insurance agents operating in Alberta are permitted under Alberta’s Insurance Act to incorporate their business. Yet a dual licensed advisor for insurance and mutual funds/securities can operate their insurance business through a corporation, but not their mutual funds and securities business. This creates a duplication of costs and closes doors on proper tax and succession planning.
Currently, under a temporary exemption granted by provincial securities regulators in Ontario, Manitoba, Saskatchewan, Nova Scotia, New Brunswick and British Columbia, members of the Mutual Fund Dealers Association of Canada (MFDA) are permitted to pay commissions to incorporated salespersons. Alberta is the only province recognizing the MFDA to not permit this temporary exemption. The MFDA exemption is scheduled to expire on March 31, 2010.
Other provinces have stated that they will not extend this temporary exemption and that a permanent solution needs to be implemented. It is likely that these provinces will continue to allow advisors in neighbouring provinces to be compensated to a corporation through their own permanent solutions.
For Alberta to keep in step with the other provinces, its Securities Act needs to be amended to allow the definition of “salesperson” to include a corporation and to allow for the exemption of the corporation from being registered, as the individual advisor is already a registrant under the Act. This exemption has worked successfully in British Columbia and Manitoba. These changes will remove the competitive disadvantages that Alberta’s investment advisors have as compared to advisors in neighbouring jurisdictions.
Consequently, the Red Deer Chamber of Commerce recommends that the Government of Alberta:
April 29, 2014
Business After Hours - Alberta Works - Government of Alberta
Hosted by: Government of Alberta Alberta Works Centre 3rd Floor First Red Deer Place ...
May 7, 2014
Chamber Luncheon - Red Deer Airport & Air Canada
Speakers - RJ Steenstra - Red Deer Airport CEO Kevin Howlett - Air Canada Senior Vice President Please join Air Canada’s S...
May 15, 2014
Speaker is Cindy Shelfoon - Iniestra with Alberta Works Come join us as Cindy talks to us about labour issues, trends and retention in the...