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PREC situation

You are closing it down. The articles are about to be read closely.

Winding down a Personal Real Estate Corporation is a process where the founding documents get read closely, often for the first time in years. A corporation is a PREC only while it meets the criteria in section 2 of Ontario Regulation 536/20, and your brokerage can pay it only while it also meets the conditions of its exemption from registration in section 3. Most of these turn on facts, such as who holds the shares and who is the director, and the articles can make a breach easier or harder. The free PREC Articles Health Check reads your articles against both regimes that govern a PREC, the PREC conditions in Ontario Regulation 536/20 (administered by RECO) and the Income Tax Act rules, administered by the Canada Revenue Agency, that decide how the corporation is taxed, and rates each Red, Yellow or Green. A hint to take to your lawyer and CPA, not legal or tax advice.

Winding up is a reading exercise

Retiring, leaving the industry, or simply collapsing a structure you no longer need all involve someone going through the corporation documents carefully. That is usually your accountant and your lawyer, billing by the hour.

Surprises are expensive at that stage

Anything unexpected in the articles is most costly to find at the end, when it is being untangled rather than corrected.

Go in knowing

The free check takes a few minutes and gives you the shape of what they are about to read.

How to check yours

The PREC Articles Health Check is free. You upload or paste your articles of incorporation and it reads them against both regimes that govern a PREC: the RECO PREC conditions in Ontario Regulation 536/20, and the Income Tax Act rules, administered by the Canada Revenue Agency, that decide how the corporation is taxed.

You get a Red, Yellow or Green rating for each regime, with every requirement named and what was actually found in your text. There are no forms to fill in.

The check runs in your browser and does not upload your document. Your articles are saved only if you choose to: as an encrypted copy kept for 90 days, if you ask for that when your report is emailed, or with your answers if you sign in to amend them.

What it is, and what it is not

The Health Check produces a drafting-quality hint from the article text you provide. It is a starting point to bring to a qualified lawyer and CPA, not a legal finding that your corporation qualifies as a PREC, and not tax advice. Always have a professional review before you rely on or file anything.

It does not replace your lawyer or your accountant, and it is not meant to. It is meant to make the conversation with them shorter and sharper: you arrive knowing where your articles stand and which protections need attention, instead of paying for that discovery from scratch.

Capital Toolkit is an automated service. It provides general information, not legal, tax or accounting advice, and it does not replace your own lawyer or accountant. Have a qualified professional review any document before you rely on it, sign it or file it.

If you want the full analysis

The rating and the list of which protections are present or missing cost nothing. What is paid for is the PREC Deep Dive at $100 CAD: the full clause-by-clause written analysis of what is wrong, why it matters, and what to raise with your lawyer. HST is added at checkout.

Score my articles freeHow PRECs work