The corporation is a new set of book and a new company.

The sole proprietorship is a separate set of books and not to be combined into the new company.

I would suggest you contact your client's accountant and find out the best way to handle these assets coming in including the GST question. I would think no GST since the asset were purchased in Client's name and not in corporation's name. The sale is now from the client to the corporation - not from the vendor the assets were purchased from. Making an incorrect decision could result in tax liability to the corporation and to the sole proprietorship if one is not familiar with this. In a lot of cases the unwanted tax liability cannot be reversed.

If your client does not have an accountant then now is a good time to get one before you have completely set up the books for the new corporation.

I agree with Smithco;

1) you and your customer should meet with an accountant now

2) keep the sole proprietorship separate from the corporation

My misunderstanding. I believe she paid ITC from the sole proprietorship not the corporation. Her corporation has a new business number, hst account, etc.

I know, and she knows,  the corporation needs it's own set of books completely separate from the SP….and I know she needs to discuss this with her accountant…..just trying to figure out how to account for the assets of the SP that are now part of the corporation. Specifically the funds in her bank account that are now part of the corporation.

Should that be recorded as a shareholder's loan if she wants to be paid back? Or Shareholder's investment if she wants to invest and be paid dividends? Really it depends on what she decides with her accountant. However I need to  record it somehow in Quickbooks. Whatever I do….. shareholder's loan or investment….  can be changed with a year end adjustment entry based on her accountant advises.