Complete Business Incorporation Checklist for Canadian Entrepreneurs
Thinking of incorporating your business? This step-by-step guide covers everything from name selection to CRA registration. Free checklist included.
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Key Takeaways
- Incorporation is a multi-step process with specific requirements
- Federal vs provincial incorporation - know the differences
- Must register for GST/HST, payroll, and other CRA programs
- Corporate bank account and minute book are essential
- Annual filings required to maintain good standing
Why Incorporate?
Incorporating your business creates a separate legal entity. This offers several advantages:
- Limited liability: Personal assets protected from business debts
- Tax advantages: Small business tax rate of 9-12.5% (vs personal rates up to 53%)
- Credibility: "Inc." or "Ltd." signals established business
- Easier succession: Shares can be transferred or sold
Step-by-Step Incorporation Checklist
Step 1: Choose Your Business Name
- Run NUANS name search ($20-$100)
- Ensure name is unique and available
- Consider numbered company if name not critical
- Check trademark registry for conflicts
- Reserve name if needed (60-90 days)
Step 2: Federal vs Provincial Decision
Federal Incorporation:
- Can operate under same name in all provinces
- Cost: ~$200-$300
- Still need to register in each province you operate
- Name protection across Canada
Provincial Incorporation:
- Less expensive (varies by province)
- Good if only operating in one province
- Must register extra-provincially if expanding
Step 3: Prepare Incorporation Documents
- Articles of Incorporation
- Initial registered office address
- First director(s) names and addresses
- Share structure (typically start with common shares)
- Restrictions on share transfer (if any)
Step 4: File and Receive Certificate
- Submit to Corporations Canada (federal) or provincial registry
- Pay filing fees
- Receive Certificate of Incorporation
- Note your Business Number or Corporation Number
Step 5: Create Corporate Minute Book
- Organizational resolutions
- By-laws
- Share register and share certificates
- Director and officer register
- Copies of all filed documents
Step 6: Register with CRA
- Apply for Business Number (BN)
- Register for GST/HST (if revenue over $30,000)
- Register for Payroll account (if hiring employees)
- Register for Import/Export accounts (if applicable)
Step 7: Open Corporate Bank Account
- Bring Certificate of Incorporation
- Bring resolution authorizing account opening
- Personal ID for signing authorities
- Keep business and personal finances SEPARATE
Step 8: Ongoing Compliance
- Annual return filings (federal or provincial)
- Corporate tax return (T2) within 6 months of year-end
- GST/HST returns (monthly, quarterly, or annual)
- Payroll remittances and T4s
- Update corporate records as changes occur
Typical Incorporation Costs
DIY Online: $400-$700
- NUANS search: $20-$100
- Filing fees: $200-$300
- Minute book software/template: $50-$200
Professional Service: $1,000-$2,500
- Includes all of above plus professional preparation
- Proper share structure for tax planning
- CRA registrations completed
- First year bookkeeping setup
Common Mistakes to Avoid
- Wrong share structure: Limits future tax planning
- Missing minute book: Required for audits and financing
- Not separating finances: Loses liability protection
- Missing annual filings: Corporation gets dissolved
- No CRA registrations: Penalties and interest
Ready to Incorporate?
Tax Punjabi offers complete incorporation packages starting at $999. Includes proper share structure for tax planning, minute book, and all CRA registrations.
This article is for educational purposes only. Consult a professional for your specific situation.