The Essentials For Starting A Business In Canada
Starting a business in “Great White North” is such an exciting journey, but it can also feel overwhelming if you’re unsure where to begin. Luckily, Canada is known for being one of the best places to start a business, the market is so incredibly diverse and knowing the right steps can make all the difference. Canada also offers platforms like Bizfund where you can apply for Business Financing to help scale your business.
Don’t worry, though. This guide will walk you through the process in simple, easy-to-understand steps. With a little planning and the right approach, you’ll be well on making your business idea a reality. So, let’s get started on turning that dream into a successful business!
Choosing the Right Business Structure for Your Canadian Venture
There’s no doubt that starting a business comes with exciting opportunities, but selecting the right structure is a crucial first step. Your business structure determines your legal responsibilities, tax obligations, and level of personal liability. The most common options include sole proprietorships, partnerships, corporations, and cooperatives.
Sole Proprietorship
A sole proprietorship is one of the simplest and most common business structures in Canada. It’s ideal for individuals starting small businesses, as it’s easy to set up and has minimal regulatory requirements. As the sole owner, you have full control over decisions and profits. However, you’re also personally responsible for all debts and liabilities, meaning your personal assets could be at risk. This structure is great for freelancers, consultants, or anyone wanting to test a business idea without significant upfront costs.
Partnership
A partnership is a business structure where two or more individuals share ownership, responsibilities, and profits. This approach allows partners to pool resources, expertise, and skills, so it’s a popular choice for entrepreneurs who are looking to grow a business together. Partnerships can be general, where all partners share liabilities, or limited, where some have restricted involvement and liability. This is totally up to you though, and of course, your business partner.
Corporation
A Corporation is a business structure that exists as a separate legal entity from its owners, and this offers several advantages. It provides limited liability, meaning shareholders aren’t personally responsible for the company’s debts. This structure also allows for easier access to capital through the sale of shares. Corporations have a distinct management structure, usually led by a board of directors, which is vastly different than just a regular small business. While there are tax benefits, there’s also more paperwork and regulations to follow.
Cooperative
Cooperatives AKA a “co-op,” is a business that is owned and operated by its members, who share in its profits, decision-making, and overall success. Unlike traditional businesses, where a few individuals or investors control operations, co-ops focus on serving the needs of their members, no matter what the business entails. Co-ops are usually found in rural areas with lower populations and are usually within the following industries: agriculture, retail, healthcare, and banking.
So with that being said, which option works best for you?
General Requirements For Starting A Business
The requirements vary based on which province you live in. Generally, this is what you’re going to need:
- Business Registration
- Business Number (BN)
- Permits and Licenses (depending on your province)
- GST/HST Registration
- Incorporation (Optional)
- Zoning and Land Use Approvals
- Employment Regulations (if hiring)
- Intellectual Property Protection
- Compliance with Health and Safety Standards
- Provincial/Territorial Requirements (more details below)
Requirements By Province
| Province | Business Requirements |
| British Columbia | Register Your Business NameRegister Your Business Obtain a Business Number (BN)Register with the Canada Revenue Agency (CRA).Register for PSTAcquire Licenses and Permits: Register with WorkSafeBCComply with Employment Follow BC’s Employment Standards Act. |
| Alberta | Select and Register a Business NameRegister Your Business Via Alberta Corporate RegistryObtain a Business Number (BN)Register for Provincial Sales Tax (PST)Alberta Treasury Board and Finance: If your business sells or leases taxable goods or provides taxable services in Alberta, register to collect and remit PST.Municipal Business LicenseIndustry-Specific Licenses:Register with Workers’ Compensation Board (WCB) AlbertaWorker’s Compensation Coverage |
| Saskawatchan | Register your business with the Corporate Registry.Obtain a Business Number (BN) from the CRA.Apply for PST registrationObtain municipal and industry-specific licenses (if required).Register with the Saskatchewan Workers’ Compensation Board (WCB). |
| Manitoba | Register your business with the Companies Office.Obtain a Business Number (BN) from the CRA.Apply for a Manitoba business licenseRegister for Retail Sales Tax (RST)Comply with zoning and land-use bylaws.Register with the Workers Compensation Board (WCB) if hiring employees. |
| Ontario | Register with ServiceOntario.Obtain a Business Number (BN) from the CRA.Register for GST/HST and other applicable taxes.Acquire municipal business licenses and permits.Check zoning regulations for your business location.Register with the Workplace Safety and Insurance Board (WSIB). |
| Quebec | Register your business with Revenu Québec and obtain a Quebec Enterprise Number (NEQ).Apply for GST and QST (Quebec Sales Tax) registration.Comply with language regulations (French).Register with the Commission des normes, de l’équité, de la santé et de la sécurité du travail (CNESST). |
| New Brunswick | Register your business with Service New Brunswick.Obtain a Business Number (BN) from the CRA.Register for Harmonized Sales Tax (HST)Register with WorkSafeNB for employee coverage. |
| Newfoundland & Labrador | Register your business with the Registry of Companies.Obtain a Business Number (BN) from the CRA.Apply for HST registrationRegister with WorkplaceNL for employee coverage. |
| Nova Scotia | Register your business with Nova Scotia Registry of Joint Stock Companies.Obtain a Business Number (BN) from the CRA.Apply for HST registrationObtain municipal business permits and licenses.Register with the Workers’ Compensation Board of Nova Scotia. |
| PEI | Register your business with the PEI Business/Corporate Registry.Obtain a Business Number (BN) from the CRA.Register for HST Register with the Workers Compensation Board (WCB) of PEI. |
| Yukon | Register your business with Yukon Corporate Affairs.Obtain a Business Number (BN) from the CRA.Apply for GST registration Acquire municipal and industry-specific permits.Register with the Yukon Workers’ Compensation Health and Safety Board. |
| Northwest Territories | Register your business with the NWT Corporate Registry.Obtain a Business Number (BN) from the CRA.Register for GST Obtain municipal licenses and permits.Register with the Workers’ Safety and Compensation Commission (WSCC). |
| Nunavut | Register your business with the Legal Registries Division.Obtain a Business Number (BN) from the CRA.Apply for GST registration Acquire municipal business licenses.Register with the Workers’ Safety and Compensation Commission (WSCC). |
The Process Of Starting A Business
Starting a business on Canadian soil is pretty easy Canada involves several essential steps. Here’s a clear list of what you need to:
- Choose a Unique Business Name – Confirm your business name complies with provincial or territorial naming regulations.
- Decide on a Business Structure – Choose your business structure. More information above.
- Register Your Business – Register at the provincial or federal level, depending on your business type and scope. Of course, requirements differ between provinces so always confirm provincial regulations.
- Obtain Licenses and Permits – Check if your industry requires special licenses (e.g., food services, construction).
- Understand Tax Obligations – Obtain a business number (BN) and register for GST/HST if your revenue exceeds $30,000 annually.
- Comply with Employment Standards – If hiring staff, you need to make sure proper payroll deductions and workplace safety measures are done.
Overview
Starting a business is super exciting and a way of reclaiming your freedom and building a strong foundation for financial success. While the process might feel overwhelming at times, breaking it down into manageable tasks can make it more achievable.
Remember, every successful entrepreneur started somewhere, and the key is to stay persistent and adaptable. Don’t hesitate to seek help if needed, especially if you’re struggling or have no idea as to where to start or go next.
