How to Incorporate or Register Your Business

 

Incorporation

 

Incorporating a small business will cost about $600 or so and offers better name protection to the owner.

There are two types of incorporations: Federal and Provincial. For most small businesses, a provincial incorporation is all that is needed.

Private Incorporation:

The only concern here is with the kind of corporation which an individual or a few associates may set up. You and or your associates will not sell shares to the public. You will be operating what is generally described as a "private" corporation

The biggest benefit to incorporating is income tax savings.

You can also deduct many expenses and split income to get a lower tax rate.

It used to be incorporating protected the owner from the debts of the corporation. Today all lenders require the borrower to take personal responsibility for the loan regardless of the fact that the corporation is borrowing the money.

The CRA and other government agencies also require a lot of paperwork from the corporation.

But corporations look better, (professional, serious) to customers and suppliers. Customers and suppliers will also expect or require you to have a "real" business before they will deal with you

On balance, if you can afford it, incorporate your business in your own home province. Despite some negatives, it probably is the better option and you will feel better having an INC or LTD after your company name.