It feels good to be an entrepreneur. The desire to control your career comes from within you. There’s that sense of accomplishment knowing that you get to be your own boss. Along with these emotions of excitement, pride, and determination, mechanical steps could help your business succeed. One of the first steps is to register your business.
Benefits And Difficulties Of Registering In Ontario
Choosing to start a business in Ontario is a great idea. Its population of 14.5 million makes it Canada’s most affluent market, and its incomes are among the highest in the country. Another advantage of registering your business in Ontario is that you can easily find and access pertinent information.
It may seem confusing and difficult to register a business. But fret not; this article is intended to help and guide you through that. A new business can also seem intimidating if you’ve never done it before. With so many factors to consider, registering your business is just the tip of the iceberg.
To cross this off your worries, refer to this guide so you can register your business in Ontario finally. Here are the things you need to do:
- Decide On The Type Of Business
Identifying the type of company and its legal form (sole proprietorship, partnership, corporation) would be the first step. Depending on your needs, you may need to consult an accountant or lawyer. It would also be helpful if you’ve decided whether to handle a business by yourself or to share a company with a group of friends and colleagues whom you trust.
In Ontario, you could register your business under different structures. Among these are sole proprietorships, partnerships, and corporations. It is strongly recommended you seek independent legal advice before proceeding with any business registration.
Registering a business is a crucial step, not only legally but also financially. Therefore, we will focus on sole proprietorships, partnerships, and corporations because they are the most common types of business.
- Register Your Business As Sole Proprietorship Or Partnership
One person owns a sole proprietorship, and unlike a corporation, it does not have legal status. As the owner, the business is entirely under your control, you will generate all profits, and you will owe the company any liabilities. The Ontario government’s Central Production and Verification Services Branch requires you to register a sole proprietorship business name different from your own.
- Come Up With A Business Name
It would be helpful to consider a catchy name that reflects your brand, your image, or one that describes your business. You could also avoid business names that imply any association with incorporation, partnership, or not-for-profit status. Words like ‘incorporated’ or ‘limited’ words may be misleading if you’re registering for a sole proprietorship or partnership.
- Register Your Business Name
You could register your business name online, by email, or personally. When submitting a sole proprietorship or partnership application (Form 1), the following might be required:
- Name of business
- Postal business address
- A street address of the principal business location in Ontario (not a PO box)
- An overview of the company’s activities
You may receive your Master Business License in two business days after you submit your online application. The fee for an online application is CAD$60. Mail-in applications are subject to a processing fee of CAD$80.
Within 20 business days after registering by mail, you may expect to receive a Master Business License. According to their laws, a business name must be renewed every five years before its expiration date, including renewal fees.
- Register Your Business As A Corporation
When deciding whether to incorporate your company, it would help if you weigh the pros and cons and choose between a local or federal entity. Corporations in Ontario are legal entities and protect their names only in that province. Combining as a nationwide corporation allows you to do business anywhere in the country with a protected name.
Incorporating is a straightforward process. The steps involved in forming a corporation in Ontario are as follows:
- Decide On A Name
Picking a name is similar to the process for sole proprietorship or partnership. According to their legal requirements, you shouldn’t associate the name with the government, province, territory, municipality, and anything related to the Crown. But if you get legal consent from the authority, it could be possible.
- File The Articles Of Incorporation
The next step is filing the Articles of Incorporation. Incorporation articles are documents filed with your government to register your corporation. It also properly (and legally) documents the company’s beginnings. Incorporating documents could include:
- Name verification of your corporation: Double checking whether the name follows the legal requirements could help you avoid delays.
- Your business’s purpose or intention: This is categorized as either a general or specific category. The latter could entail deeper research about the niche that your business will serve.
- A company’s registered office address: Based on their conditions, PO boxes cannot be used for this purpose.
- Directors and shareholders: Unlike sole proprietorship or partnerships, there would be several individuals involved.
- Founding directors’ identification, contact information, and addresses: Canadians residing in Ontario would make up at least 25% of directors. According to the legal requisites, one Canadian director is needed if three or fewer directors involved.
- Other relevant materials, including voting rules: If you aren’t sure what other documents are needed, getting legal help could help with preparations and clarifications.
- Signatures of all shareholders: Getting their signatures entails that all shareholders agree with everything.
- Limitations And Other Details
While preparing and registering the documents, you might notice some limitations and other aspects that might have to be learned. To prepare yourself, here are some of the things you could expect.
- Borrowing restrictions for business directors
- Classes of shares and the specific number of shares for each class
- Rights each share class is entitled to
- Restrictions with transfer or ownership
The registration process would be completed once the articles of incorporation have been filed. Depending on how you file, the turnaround time varies. A notification of missing items on your application is sent before the registration is finalized.
You’ll know that the application was accepted if you receive a Certificate of Incorporation. As well as your completed Articles of Incorporation, it is advisable to keep a copy for your records. These documents are important to a company.
- Keep A Minute Book
Keeping corporate records is a legal requirement for your incorporated business in Ontario (also known as a minute book). You could use this to formally record your business activities, which includes:
- The resigning or changing of directors
- Required documents from meetings of shareholders
- Notices of all meetings
This sums up some helpful steps in registering your business. No matter how you decide to open a business, it would be beneficial if you were guided with the steps above to start operating your business in Ontario.
Latest posts by Adam Tanton (see all)
- How Are Managed IT Services Different From Outsourcing? Find Out Here - October 13, 2021
- Breaking Down the Latest B2B Marketing Trends - September 30, 2021
- The Importance of B2B Partnerships in Professional Sports - September 30, 2021