Starting a business in Ontario can be an exciting and fulfilling endeavor. But once again, you must register your firm with the relevant government agencies before you can begin operating it.
To make sure you are adhering to all legal requirements and that your firm is running legally, you must register your business. In this article, we will provide you with a step-by-step guide on how to register a business in Ontario.
Choosing the legal structure of your business is an important decision that can have significant implications for how your business operates and how you are taxed.
Before registering your business in Ontario, it’s important to understand the different legal structures available and the advantages and disadvantages of each.
The simplest and most typical type of business ownership is a sole proprietorship. It is solely owned and run by one individual, who is also liable for all debts and responsibilities of the company.
The owner reports the business’s income on their personal tax return and pays taxes on the profits. One of the key benefits of a sole proprietorship is that it’s simple to establish and run, and there aren’t many formalities to follow.
The owner’s unrestricted personal culpability for the debts and liabilities of the firm, however, is one of the biggest drawbacks.
A partnership is a company owned by two or more persons who split the company’s gains and losses. The business’s debts and responsibilities are shared by each partner.
Partnerships can be general or limited, and the partners can share management responsibilities. A partnership’s ease of formation, ease of upkeep, and lack of onerous legal requirements are some of its key benefits.
The fact that each partner has unlimited personal culpability for the debts and liabilities of the firm, however, is one of the fundamental drawbacks.
A company is a distinct legal entity from its owners. Shareholders choose a board of directors to run the business, which they own.
One of a corporation’s key benefits is that it offers shareholders limited liability protection, ensuring that their personal assets are not in danger in the event that the company fails. Another advantage is that corporations can raise capital by selling shares to investors.
A corporation’s principal drawback is that it is more difficult and expensive to start up and run than other company arrangements. There are additional legal duties, such as producing annual reports and conducting annual meetings, and corporations are subject to increased regulation, taxation, and other legal requirements.
Choosing a name for your business is an important decision, as it will represent your brand and be a key factor in attracting customers. When selecting a name, you should consider its uniqueness, relevance to your business, and potential to be memorable and easily recognizable.
It’s critical to confirm that no other company in Ontario is already using the name you intend to use for your company. By performing a name search on the Ontario Business Registry (OBR) website, you may determine whether a business name is available.
The OBR is a central online registry of business information that allows you to search for information about existing businesses and register your own business.
In addition to the OBR, you should also consider conducting a trademark search to ensure that your chosen name is not already registered as a trademark.
A trademark is a type of intellectual property that gives the owner the exclusive right to use a particular name, logo, or other identifying mark in connection with their business.
If the name you have chosen is available, you can proceed with registering your business name. However, if the name is already in use, you will need to choose a different name to avoid any legal issues down the line.
Once you have chosen a unique and suitable name for your business, you can move on to the next step of registering your business.
If you plan to operate your business under a name that is different from your legal name, you must register your business name. This is important because it allows your customers and other businesses to identify your business and differentiate it from others.
Registering your business name also ensures that no other business is already using the same name, which can prevent potential legal issues in the future.
You may register your company name in Ontario either in person at a ServiceOntario center or online through the ServiceOntario website.
You must register for a ServiceOntario account and fill out the necessary information, including your contact details and the name and structure of your company, in order to register your business name online.
The registration fee for a sole proprietorship is $60, while it is $80 for a general partnership. You can pay the registration fee online using a credit card or by mail using a check or money order.
Once your payment is processed, you will receive a Master Business License, which is proof of your registration and can be used to open a bank account, apply for business loans, and enter into contracts with other businesses.
It is important to note that registering your business name does not provide you with any legal protection for your business name. If you want to protect your business name, you may consider trademarking it, which is a legal process that gives you exclusive rights to use the name for your business in Ontario.
A crucial step in opening a business in Ontario is acquiring the required licenses and permits. Depending on the type of your company and the sector you work in, several licenses and licences may be needed. Legal problems and penalties may arise if the proper licenses and permissions are not obtained.
The Ontario Business Registry (OBR) can help you determine the licenses and permits required for your business.
The OBR provides a search tool that allows you to find the licenses and permits required based on the nature of your business and the industry you operate in. The tool also provides information on how to obtain the licenses and permits and the associated fees.
Most products and services sold in Canada are subject to federal taxes known as the Harmonized Sales Tax (HST) and the Goods and Services Tax (GST).
The federal GST and the provincial sales tax (PST) in participating provinces, including Ontario, are combined to form the HST. In Ontario, the HST rate is now 13%.
If your business is expected to earn more than $30,000 per year, you are required to register for an HST/GST number with the Canada Revenue Agency (CRA). You can do this online through the CRA website, or by calling their business inquiries line.
Once you register for an HST/GST number, you will be required to charge and collect the tax on your taxable goods and services. You will also be able to claim back any HST/GST that you paid on your business expenses.
It’s important to note that if you are operating a small business with gross revenues of $30,000 or less, you can choose not to register for an HST/GST number.
However, if you decide not to register, you will not be able to charge or collect the tax on your sales, and you will not be able to claim back any HST/GST paid on your business expenses.
You must fill out and submit the necessary documents to the relevant government agencies in order to register your business with them. Depending on how your firm is set up legally, other paperwork may be needed.
The following are the steps to register each business structure.
If you are registering a sole proprietorship, you need to complete the Business Registration Online (BRO) form through the ServiceOntario website. The registration fee is $60.
If you are registering a partnership, you need to complete the Partnership Registration Form 1 through the ServiceOntario website. The registration fee is $80.
If you are registering a corporation, you need to complete the Articles of Incorporation through the ServiceOntario website. The registration fee is $300.
If you plan to hire employees, you need to register with the Workplace Safety and Insurance Board (WSIB) for workers’ compensation insurance. You can register for workers’ compensation online through the WSIB website.
Registering your business is a crucial step to ensure that your business is operating lawfully and in compliance with the legal requirements of Ontario.
It also provides your business with legal protection, such as limited liability and the ability to enter into contracts in the name of the business.
Fortunately, the process of registering a business in Ontario is relatively straightforward and can be done online through the ServiceOntario website.
It is recommended that you carefully follow the steps outlined in this article to ensure that you complete the registration process accurately and efficiently.
In addition to the steps mentioned in this article, it’s also important to be aware of other legal and regulatory requirements that may apply to your business.
For example, you may need to register for other taxes, such as payroll taxes, or obtain additional licenses and permits, depending on the nature of your business.
To ensure that your business is operating lawfully and in compliance with all applicable laws and regulations, it’s a good idea to consult with a lawyer or an accountant who specializes in business law.
They can provide you with advice on the legal and regulatory requirements for your business and help you navigate the registration process.
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The ServiceOntario website allows you to register a business in Ontario online, which is true. This is a quick and easy method of registering your company from any location with an internet connection.
Small businesses in Ontario can be registered using the same procedures as other types of businesses. To register your business based on its legal structure, register your business name, get the required licenses and permissions, and register your business with the Ontario government through the ServiceOntario website, follow the above-mentioned processes.
The cost to register a business in Ontario varies depending on the legal structure of your business. The registration fee is $60 for a sole proprietorship, $80 for a general partnership, and $300 for a corporation. Additionally, there may be fees associated with obtaining licenses and permits required for your business.