If you want to start a business in Canada, the province of Ontario is one of the best places. The first step in doing so will require you to know how to register a business in Ontario.
Ontario is located right in the middle of Canada and has the highest population of all the provinces in Canada. Almost 50% of the entire population of Canada lives in Ontario. This province has the largest population base, some of the highest income levels, and easy access through planes, trains, or transport.
Ontario has about 14 crossings into the US, making it Canada’s importing and exporting center. The busiest crossings are Windsor, Fort, Eric, and Sarnia.
If you want to start your business in Ontario, many things need to be done as a part of the setup process. You must follow the Ontario Business Registry rules to have a legal business.
The first and foremost is registering your business with the Ontario government. By registering with the Ontario government, you inform the government about your company and the legal structure you will use to run the business. This legal structure is important as it determines how much personal liability you have for the business and its finances.
This is also significant in determining taxes.
For complete guidance on how to register a business in Ontario, keep on reading. We have mentioned all the necessary and additional things required for a successful and smooth business registration.
1. Registering a Business in Ontario
According to the providential government of Ontario, you will have to register a business if you have employees or operate facilities in Ontario. However, you don’t have to register if you are the sole proprietor and use your name as the business name.
You are only required to register if you have a distinct name for your business and a sole proprietorship.
To register a business, it is always preferred to register a business within 60 days of opening the business.
2. Types of Business Registration in Ontario
Four different types of business registrations can be done in Ontario.
2.1 Sole Proprietorship
A sole proprietorship legal structure is best for business owners who single-handedly run the business. These sole proprietorship businesses are easy to set up and operate and don’t usually have large amounts of expenses or income.
By this sole Proprietorship, the finances of the business and personal are mixed, meaning that the business’s liability is the liability of your personal life.
In this legal structure, there can be two or more business owners, each of whom shares the profit and loss of the business. The business is still a separate legal entity, but the owners can still be completely or partially responsible for the business’s liabilities. The degree of liability is determined by the type of the business is registered.
There are several types of partnerships:
- General partnership
- Ontario Limited Liability Partnership
- Extra-providential limited partnership
- Limited partnership
The cooperative business structure mainly consists of owners with equal votes in business operations. They are for both profit and nonprofit organizations.
The finances of the business and the owners are considered different.
2. 4 Corporation
The corporation is a legal business structure in Ontario. For this structure, some extra work is required in setting up the process, and forms must be filled out annually. However, this structure offers many benefits, the most important being that the owner’s finances and liabilities remain separate from the business.
A corporation can have more than one owner, and each of these owners can have their percentage of shares and control the operations based on the percentage.
The ownership can be both held privately or publicly traded.
3. Cost of Registering a Business in Ontario
The cost of any business registration process in Ontario depends on the type of legal structure you will be using in your business. Filling it out online or by mail will have the exact same cost. The rates are as follows:
- Sole Proprietorship – $60
- General Partnership -$60
- Limited liability partnership – $60
- Corporate (for profit ) – $335
- Corporate (nonprofit) – $155
- Cooperative – $300
You must pay an extra $26 for the actual filing cost with the government.
There are also some costs related to hiring a lawyer to prepare your document, which will be around $ 100.
4. How to Register a Business in Ontario
During the business registration process in Ontario, you will mainly have to follow three steps.
4.1 Name Your Business
The first thing you will have to do is decide your business name right when you start registering.
Start by checking if the business name you picked is already present; even though Ontario does not prohibit more than one business from having the same name, it might cause confusion, so it is better to have a unique name. This protects you from legal liabilities and avoids confusion.
To find a unique business name, you can visit Ontario’s name search database, search for the name, and see if a business already has it. This is completely free, and you can use it as many times as you want.
If you want to trademark your name, you can visit sites like the Canadian Trademarks Database, which contains all the information regarding trademarks.
4.1.1 Restrictions on Business Name
Like other countries and states, there are some restrictions on the names based on the Ontario Business Names Act. You cannot name your business with:
- Objectionable words or expressions that are prohibited under Ontario’s federal Law
- Business names that can be deceiving
- Terms such as College, Institute, or University B, unless you have special permission
- Using another person’s name without permission unless they have been dead for over 30 years.
If your business name is not violating any of these guidelines, you can go with it.
4.2 Deciding on the Type of Business You Want
While registering your business, you need to understand what type of business structure will be the most beneficial for your business. There are four types to consider:
4.2.1 Sole Proprietorship
To register a sole proprietorship business in Ontario under your name, you don’t necessarily have to register the business. However, you must register if you want it under a different unique name.
The registration process includes obtaining a master business license. Your master business license will contain your Business Identification Number (BIN). It will have your sole proprietorship business name and address.
- Decide upon a unique name for your business.
- You can complete this process online. Log in to your ServiceOntario account and enter contact details and other relevant business information.
- Lastly, you will have to pay a fee of $60 to complete the process.
You can register your partnership as general or limited, online and offline. You need to obtain a master business license, in this case, too.
- Start by selecting the business name on your ServiceOntario Account (if you have a limited partnership, you will have to agree to a specific name pattern).
- Pay $60 to $210 for registering.
To register your corporation, you need a NUANS name search.
- Once the name is selected, sign in to the ServiceOntario account and complete the form online.
- You will also have to submit the Article of Incorporation.
- The fee is $300 for registration,
To complete the registration process in Ontario, you will have to follow the steps mentioned below:
- You must get the NUANS name search report. This report is necessary for the verification of your selected business name.
- Complete the Article of Incorporation of a Cooperative.
- While submitting the registration for Ontario, you can only file it via mail or email. You cannot file it through online Forms or in person.
- Registration costs $335 for for-profit and $155 for nonprofits.
4.3 Registering the Business Online, by Mail, or in Person
Upon deciding on your business’s name and entity type, you must now apply for registration with the government.
You will need to provide information such as:
- Name of the business
- Business address
- Place of Business
- Name of the owner or partnership and address
- Type of activities in business conducts
- The person who will authorize the registration (it is usually the business owner, or you can use the name of someone else for business )
- Briefly describe your revenue, such as operating expenses, house painting, etc
Online registration is quick and easy. You only require a visa, a MasterCard credit card, and an email address.
5. Where to Register a Business in Ontario
There are many ways of registering a business in Ontario:
The process of registering a business online can be done personally by you through the Ontario Business Registry. This is one of the easiest processes. All you must do is have your One-Key and ServiceOntario accounts before starting the process.
You can always register using email. All you have to do is contact the Ontario Business Registry for more information.
For Mail, you will have to search for your nearby ServiceOntario Office, where you can send the forms required for the registration process.
Search for your nearby ServiceOntario Office and visit when you have time. It is always recommended to contact first and then go as you can know more about the Process and the best timings for a visit.
5.5 Third-party company
Other third-party companies can also do these steps for you. All you have to do is cooperate with them and pay them their fees. Some of these are :
6. Benefits of Registering a Business in Ontario
Well, everything comes with its pros and cons; here are some benefits of registering a business in Ontario:
6.1 Trust Among Customers
When you register a business, you establish a brand name, and customers will be willing to trust your brand. Also, upon registering, your business name will become unique as no other business can have the same name now. A unique name will help you get an identity in the market.
6.2 Trustful to Suppliers
As a registered business, suppliers will trust you more, sign deals, and get contracts. If you are not a registered business, there is a high chance that they will not take you seriously.
6.3 Business Banking
If you want to get a business bank account, you will have to register your business with the government. This does not only help you with accounts but also with getting loans or special business credit cards. Without a registered business, all of these are almost impossible.
6.4 Planning for Growth
Even if you initially have not registered your business, for growth in the future, you will have to register eventually, so it is always better to register first, even if there are formalities.
7. Important Considerations
The following considerations need to be specified when registering your business.
- Will you have employees or receive contracts?
You will have to answer questions like these when the application process occurs. If yes, you must register with Workspace Safety and Insurance Board within ten days of hiring.
These will also provide insurance coverage to the workplace and the employees.
- Does your business require an Employer Health Tax?
If your annual payroll exceeds $450,00, you must file for an Employer Health Tax Number. For that, you will have to register your business first.
Registering a business is essential for business owners. When you are registering a business, there can be some common issues you can face like:
- The business name already exists: One of the issues faced can be that the business name already exists even though it is not a legal problem, but it is always recommended to have a unique name.
- Name restrictions: Always ensure that the business name doesn’t conflict with any imposed restrictions. For more, read from above.
- Legal requirements: You will need to meet several legal requirements to own a business.
However, these issues are easily navigable. Starting and registering a business in Ontario is really simple. All you need to do is follow the steps mentioned above, and you are done.
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