Building a business from scratch is not easy, and most businesses do not spring overnight. A lot of hard work and dedication goes into making a business successful. If you’re serious about starting a company and growing it into something great, you’ll also want to know why Canada is such a great place to pursue your business opportunities. Business opportunities in Canada come easy relative to the other countries. If you wish to register your business in Canada you need to decide on which province or territory to wish to register in. It also depends on which city you want to start a business in.
There are many benefits of opening a company in Canada, one of the important ones being separating your personal and business obligations. This means you will not be held personally liable for the debts and actions of the corporation. Other benefits of incorporating a business in Canada are:
- Continuous existence
- Ownership of the business entity is transferable
- Raising money is easier
- Tax advantage
- Increases credibility and business worth
- Financial backing
How to Start a Business in Canada?
There are just a few steps to register your business in Canada. They are as follows:
1. Select the type of business
The first step is to decide on the type of business you wish to operate and the type of identity that will meet your needs. If you are not sure on the type of business then you should consult a business specialist who can help you with the same. Let us first understand the different types of business entities in Canada:
Sole Proprietorship is a business structure owned by an individual. It is the simplest kind of business entity. The owner is solely responsible for all the profits and losses made in the business and is also the sole decision maker. You may choose to register a business name or operate under your own name or both.
Partnership concern can be of three types (1) General Partnership (2) Limited Partnership (3) Limited Liability Partnership. In a general partnership, each partner is jointly liable for the debts of the partnership. In a limited partnership, a person can contribute to the business without being involved in its operations. A limited liability partnership is usually only available to a group of professionals, such as lawyers, accountants or doctors.
This type of business entity’s incorporation is done at the federal or provincial level. Under this, as a shareholder, you are not personally liable for the debts, obligations, or acts of the corporation.
2. Name your business
If you have been thinking of starting a business for a long time, chances are you might already have thought of a name for the business. If not, choose a right name for your business. It should be unique and easy to remember and also should describe the product and service you want to sell.
Here are a few points to consider when naming your business:
- Short names are easier to remember
- Descriptive names can help people understand what your company sells
- Professional names can fit the image you want to project
- Unique names ensure that the name is not already in use
3. Register your Business Name
You can complete an optional name search and register your business in the following ways:
- Through service website
- In person at a service center
- By mailing an application to the address indicated on the form
The cost to register your business ranges from $60 to $80. Your registration is valid for five years, at which time it must be renewed.
4. Choose the Location
Choosing an appropriate location can be critical for many businesses. The address of your business is often needed for getting license and other permits. Your ideal location will depend on your business needs, zoning restrictions and where your customers and competitors are. Taxes, noise and the local business environment are also important factors to consider when reviewing your options.
5. Get Finances and Grants for Business
Getting enough finance for business is the most challenging aspect in the complete process. In Canada, there are both government and private-sector sources of finance that you can tap into to get your business started. The financing includes grants and contributions (which generally do not have to be repaid), loans, and loan guarantees (which generally do have to be repaid).
6. Get a Business Number (BN) or a Québec Enterprise Number (NEQ)
A Business Number (BN) is a 9-digit account number that will identify your company with federal and provincial governments forever. And a Québec Enterprise Number (NEQ) is required if you are incorporating in Quebec.
7. Incorporate Federally or Provincially
The businesses set up in Canada have an option to incorporate federally or provincially. Federal incorporation lets you do business under the same name in all provinces and territories, but it’s more expensive and a little more work to set up and maintain. Provincial incorporation, on the other hand, is likely sufficient for most e-commerce business owners operating out of Canada.
8. Get a Business License
Even though it is not necessary for all the businesses, there are many new businesses that will need to get business license before they can operate legally within their municipalities. You may also need other permits depending on the type of business activity you conduct. You can do the Canada Business Permits and Licenses Search to get more clarity.
9. Register for Goods and Services Tax (GST)/ Harmonized Sales Tax (HST)
If your business makes around $30,000 or more in total revenue per year, you must register for a GST/HST account. Many merchants with less revenue volunteer to register because once you have a GST/HST account you can get the taxes you pay as a company refunded by the government.
10. Pay the Fees
- $8-$26, depending on the types of records you want to include in your search
- $60 to register
- $60 to renew
If you are completing your business registration online, you must have a valid email address and credit card as this is the only way to pay for searching existing registrations as well as registering your own business.
The extremely strong presence and success of small businesses in Canada prove the nation’s viability for startups. Apart from this, the right business climate and profitable market make Canada an ideal location for an entrepreneur to start a business. The barriers to entry, both financial and regulatory, are very low. Compared to the rest of the world, Canada is a great place for startup businesses. If you’re getting serious about pursuing business opportunities in Canada, don’t delay. Take advantage of the Canadian small business climate by starting your business today. Consulting a business advisor at the inception of your business might be a provident choice – to help you with the formalities and legalities of business setup here. We at Business Setup Worldwide have our team of experts in the country to sail you through company formation support services. If you are planning to start a business in Canada, contact us – we’d be glad to assist!