MDLegals®, as a government approved corporation, offers all types of business registration service online for all provinces across Canada. As a customer, all you need to do is, to fill our very simple online form and submit. The remaining part is taken care by our lawyers and incorporation specialists. In the very first step, your order will be reviewed by a specialist who will ensure forms are filed duly. Then, it will go to the legal team who will obtain the NUANS Report, Name Approval from government and then register with government. Because we are authorized agent of Industry Canada as well, therefore NUANS Report and Name Approval done in a very fast speed. Then as the agent of corporation registration, we register the business within next few minutes. If you choose Urgent Two Hours service, you will receive the business registration documents by 2 business hours in email. After that a physical copy by mail. The email copy is sufficient to open bank accounts.
Guidelines to Choose Right Format of Business:
Well, “Business Registration” is a very generic term. In Canada a business can be registered in above five formats. Here is a quick explanation and guidelines for you to choose the right form of business for you.
Incorporated vs non-Incorporated:
First question to be asked, are you looking to register a business that has its own existence (legal entity) and limited liability (LLC)? If the answer is yes, then your choice is Incorporation. Among the above five, only Incorporation has the limited liability and own existence (legal entity). To make it simple, if anything happens to your business the liability goes to business itself, not to your personal life. A very classical example: if somebody sue your business, and then court order goes against our business, then the liability goes under the incorporated business. The worst case scenario can happen is, you may declare your corporation as Bankrupt. It won’t go after your personal assets such as your house or car or credit score etc. However, for a non-incorporated business, the liability on you, it can go after your personal assets. A corporation also has tax benefits. When you spend for business purpose, including your car expenses, house rents etc. All this can be claimed and get corporate tax benefits as a corporation while non-incorporated business don’t have that benefit. A corporation has also perpetual existence, which means the business doesn’t die at the death of its owner. While non-incorporated business dies at the death of its owner. When you spend money to incorporate, this initial spending has tax benefits since it can be claimed as “Business Development Expense”. But when you register a non-incorporated business, you can’t get this benefit either. A corporation’s name is more strongly protected than a non-incorporated business name. Therefore, if doing a business online where you could be present anywhere in Canada or outside of Canada, the best choice would be incorporating as a federal Corporation.
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 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. Ontario Master Business License: Well, a Master Business License is another form of Sole Proprietorship (non-incorporated). In the province of Ontario, a sole proprietorship is alternatively named as Master Business License. Therefore, if you fall into the category of sole proprietorship and you are in Ontario, then this is your choice. A Master Business License can be owner by an individual or a corporation. When it’s owner by a corporation, it’s called Trade Name.
A sole proprietorship or master business license is owned by an individual, while a trade name is owned by a corporation. The most common case of trade 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 have a corporation which is doing one type of business, but you want to start another type of business in a different name but under the same corporation. A corporation can take many trade name. When a money order or bank cheque comes in those alternative names, bank deposits it into the same corporation’s account.