Now that you have sorted out your business plan and are ready to register a business in Canada, let’s look at the core aspects that go into company formation process. When you first decide to start your own business, you must determine the structure of your company. In Canada, you primarily have four types of company structures. They are Corporation, Sole Proprietorship, Partnerships and Cooperatives.
Incorporation is a structure that is separate from its owners and shareholders. The biggest advantage to it is that the liability is limited. You are not personally liable for any debt incurred. Sole Proprietorship on the other hand is easy and inexpensive to start, but, you are solely responsible for any debt the company may incur. Partnerships are formed with 2 or more individuals and the individuals sign agreements between them to limit liability. In Canada, with the exception of Yukon, Prince Edward Island and Nunavut, other provinces allow you to form Limited Liability Partnerships, but this structure is limited accountants and lawyers only in most of the provinces. The last form of structure is the cooperative, where the business is owned and operated by an association of members. The biggest advantage is the democratic nature of the organization. However, this form of structure is not that common in the country.
Once you settle on the structure of your company, determine the name of your company. Ensure that the name reflects the product and services that you offer, unique enough so that the customers can remember and lastly it is legal to use. Once you choose a name, you need to perform a name search at http://www.nuans-canada.ca/ to ensure that it is not already taken. The complete report will cost you $39.95.
Once you obtain your name, you will have to obtain a business number, which uniquely identifies your business to provincial and federal governments. Once you have received the number, you’ll have to get HST/GST, Payroll, Income Tax, Import/Export and other federal and provincial numbers. You can obtain these numbers by visiting http://www.cra-arc.gc.ca/ and filling out the respective forms. Most provinces require that you register the business with them. You’ll need to check in with your respective province for their requirements. If you are incorporating your business and plan to do business in every province, you may need to incorporate federally. If not, provincial incorporation is sufficient. You’ll have to check in with your respective province regarding the rules of provincial incorporation.
Lastly, you may require specific permits and licence to operate your business. To find out which permits you require, you can search Canada Business Network database at http://www.entreprisescanada.ca/eng/page/2843/.
This is not a legal document, but a simple guideline to help you register your business in Canada. Best of luck in your new business venture!
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