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PREC situation

Your lawyer incorporated it. Was it drafted as a PREC?

A Personal Real Estate Corporation only keeps its status while its articles and its conduct stay inside Ontario Regulation 536/20. A PREC incorporated by a general corporate lawyer is often drafted from a standard template rather than against that regulation clause by clause, so the articles can be entirely valid as a corporation while leaving the specific protections a PREC depends on unstated. The free PREC Articles Health Check reads your articles against both regimes that govern a PREC, the RECO registration conditions in Ontario Regulation 536/20 and the Canada Revenue Agency rules 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.

Two different jobs

Incorporating a company and drafting a Personal Real Estate Corporation are not the same piece of work. The first is routine and your lawyer does it well. The second means writing the articles against Ontario Regulation 536/20, clause by clause, so the protections a PREC depends on are actually on the page rather than assumed.

A PREC incorporated from a general template is usually a perfectly valid corporation. The question this page is about is narrower and easier to overlook: whether the articles say the specific things a PREC status rests on, or whether they are silent on them.

Why it is easy to miss

Nothing about a template-drafted PREC looks wrong. The certificate arrives, the corporation exists, the brokerage pays it, and the accounts are opened. Silence in the articles is not visible from any of that. It only shows up when someone reads the articles against the regulation, which is normally the moment a problem is already being dealt with rather than avoided.

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 registration conditions in Ontario Regulation 536/20, and the Canada Revenue Agency rules 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.

Your articles are analysed in your browser. The document is never uploaded, stored, or sent to Capital Toolkit.

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.

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 $1,000 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.

Drafting-quality hints, not legal or tax advice.