Registering Companies in Canada
Please, choose the appropriate type of your business and fill the form below.
There are three basic business structures available in Canada: Sole Proprietorship, Partnership, and Corporation.
- A Sole Proprietorship is a business structure in which one individual owns and manages the whole company.
- Simple and straightforward to use. In a sole proprietorship, all decisions are made by the owner, who also gets all the profits and bears all the losses.
- The owner has the option of registering a business name under a different name or using both names simultaneously.
- If a company and its owner share a name, no bank business account is required to process cheques payable to that company.
- The company’s liability is the same as the individual’s liability who runs the business.
- Tax planning opportunities aren’t flexible as all taxes are paid by the owner as an individual who owns the entire income.
The term Partnership refers to a grouping of people, corporations, or other entities who come together to conduct business. There are separate laws, norms, and regulations governing partnerships in each province, but all governments recognize them.
A registered trade name, a registered tax number for applicable taxes, and a bank account are all required for a partnership to operate as a company.
- You can easily manage a partnership since it divides earnings and losses in accordance with the professionally drafted agreement, and provides rules for new members and partners who leave. It also divides income in accordance with those rules as well.
- A partnership’s profits, losses, and expenses are reported separately by each partner on their tax return.
- In addition, there are restrictions on the kind of expenses that can be deducted. Individual personal tax rates apply to taxable income.
- The assets of each partner can be confiscated to settle claims if the partnership is sued.
A Glance at the Types of Partnerships
There are four types of partnerships: general, limited, limited liability partnership, and undeclared partnership (mostly recognized in Québec).
General Partnership – An unrestricted general partnership means that the company was formed by two or more partners, and each member is fully responsible for the partnership’s debts and liabilities in perpetuity. Please be aware that general partnership is structured differently in Québec.
Limited partnership – this type of partnerships require at least one general partner as well as at least one limited partner; limited partnerships do not. Some partners pay money while others do the actual job in a setup like this. The limited partners’ responsibility is determined by the amount of capital they have invested.
Limited liability partnership A limited liability partnership (LLP) indicates that no one partner is liable or responsible for the actions or inactions of the others. Architecture and engineering firms, engineers, lawyers, doctors and accountants are common professions that create LLPs. All Canadian provinces have access to LLPs.
Undeclared partnership (a joint venture (a term that is most commonly used in Québec) A partnership does not have both a legal person and a juridical personality if this is the case. Each partner acts on behalf of the others in their partnership. In Québec, any unregistered partnership is deemed a joint venture, so if you go this route, you’ll still require legal assistance. Written or verbal agreements or contracts between partners may result from the purpose to form a joint venture, or they may be based on circumstances indicating such an intention.
Canadian corporations can be federal or provincially incorporated. We can incorporate your business into any Canadian province or territory you are interested in. However, each provincial incorporation means starting a different process accordingly to local laws, rules, and regulations, so each time, we will have to start the procedure from scratch.
The difference between federal and provincial incorporation are:
- Defending the rights to a company’s name
- Business capabilities across all provinces and territories
- The total cost of forming and renewing a Limited liability company (LLC)
Canadian corporations are created through the filing of articles of incorporation, which outline the type of business being formed, its officers and directors, and its bylaws, with a provincial or federal government.
- Corporations are treated as independent legal entities from their owners for tax and legal purposes. This means that if something were to happen to the owner, the business would be able to function normally. It has an advantage over other business structures, such as partnerships or sole proprietorships. Assets can become encumbered in such structures as a result of estate or taxes concerns.
- Liability is minimized. If the business is sued, the assets of the owners will not be confiscated to pay the debts.
- There are only a few restrictions on the expenses that corporations can deduct when filing their taxes. They have set tax rates on their pre-tax income, and they pay taxes based on that. Once the net income has been divided to owners, it is subject to the second round of personal income taxation.
For the most part, a non-profit organization is formed in order to carry out community initiatives and philanthropic works as well as educational, sport and religious causes or scientific endeavors.
Any profits earned by a non-profit organization are reinvested in the organization to enhance its goals and initiatives, not used for the benefit of its directors, members, or executives.
Non-profit organizations come in a variety of shapes and sizes, including:
either a business or a neighborhood group
- Athletics or sports
- Social groups and clubs
- Service clubs
Non-profit corporations with charity status can issue tax receipts and/or qualify for certain tax advantages. The charitable status is not immediately achieved when you set up a not-for-profit, despite the fact that many of them are registered as charities.
You are free from paying income tax if you are a not-for-profit organization, but you may be required to submit a specific CRA form.
Various government agencies offer grants, donations, subsidies, and loan guarantees.
What we need from you:
- Share with us a little about your company (fillable form)
- Select the province where you want to register or select “the entire country” instead:
- Ontario, Quebec, British Columbia (BC), Nova Scotia, Alberta, Saskatchewan, Manitoba, New Brunswick, Prince Edward Island (PEI), Newfoundland and Labrador, Northwest Territories, Nunavut, and Yukon.
- All of the United States
Send us a message with the details of your request.
In the event that you submit a request, one of our specialists will go over your documents to make sure they are complete before they are submitted. Most of the time, it takes few days to process.