Register Your Business Online

Incorporation: First question to be asked, are you trying to register a business that has its own existence (legal entity) and with limited liability (LLC)? If the answer is yes, then your choice is business incorporation. A limited liability simply mean, if anything wrong happens to your business, the liability goes to the business itself, not to your personal life. Among the above choices, only Incorporation has the advantage of limited liability and legal existence

Sole Proprietorship: This is the best choice when you are just starting a very small business, where you even not sure, you will have any customer or not. The sale and transaction is so small that you feel there is no issue of liability nor tax benefits. A Sole Proprietorship also a good choice when you are a foreigner in Canada; because to make a corporation you or your partner (at least 25% of the owners) has to be either Canadian citizen or Permanent Resident (exception for British Columbia only). Sole proprietorship is where you have a single owner; if more than one owner, it becomes a General Partnership.

General Partnership: A general partnership is just another form of sole proprietorship where more than one owner involved. This is a non-incorporated form of business hence, liability goes to the partners; tax benefits can’t be claimed and as well as no perpetual existence. This form of business is best when you fall into the category of sole proprietorship, but has more than one owner. A major difference between a sole proprietorship and partnership is, a partnership must have a partnership agreement, while sole proprietorship does not need that.

Trade Name/DBA/Operating Name: The most common case of trade name/DBA/operating name registration is, when you have a numbered corporation and you want to add a name to it. Or you may have a named corporation, but you want to add another name as a DBA (doing business as). A Trade name also registered where you want to venture different types of business activities under same one corporation (to organize each business activity in each name and open bank account in each name). A corporation can take many trade name/DBA/operating name. A bank cheque can come in any one of these names and it would be deposited to the same corporation account.

Advantages of a Corporation

Limited Liability: Let’s clarify it with an extreme example. If somebody sue your business and the court order goes against your business, then the liability goes under the incorporated business (not against your personal life). When you are incorporated, in an worst case scenario, your incorporated business may declare bankruptcy. It won’t go after your personal assets such as your house or car etc. However, for a non-incorporated business, the liability on you, it can go after your personal assets.

Tax Advantage: A corporation also has tax benefits. When you spend for business purposes, including your car expenses, office rents (partial rent of your residential space) can be claimed under tax benefits, while a non-incorporated business can’t have such benefit.

Perpetual Existence: A corporation has also perpetual existence. An incorporated business doesn’t die at the death of its owner, while a non-incorporated business dies at the death of its owner.

Business Name Protection: An incorporated business name is more strongly protected than a non-incorporated one. If you are commencing an online business, it expands anywhere in or out of Canada. In that case, an incorporated business name prevails over an unincorporated one.