Candace,

Respectfully, I think you are confusing the issue I am making. If a foreigner comes and is looking for advice, he/she generally views the country from a federal perspective. There are nuances for the provincial approach that take up more space than this forum allows. The provincial incorporation requires at 25% minimum Canadian Director (re: legal Miller Thomson White Paper)--as a director you are liable. If you use an incorporated entity to hold real estate, and it shows losses consistently; especially if you are holding a house that is generating no to little income that does not cover your expenses, you will likely attract an audit. I have personally seen this numerous times. You cannot declare loses indefinitely without a reasonable expectation of a profit without attracting tax authority scrutiny which in of itself will open up a huge can of worms if you know what I mean. The original post infers non-scrutiny thru no 'liability' loophole which is inaccurate.