Congratulations! You’ve got a brilliant business idea and are ready to make it a reality in the vibrant province of Ontario. But before you start raking in sales, there are some essential steps to take.
One of the first hurdles you’ll need to clear is registering your business. Don’t worry, the process is straightforward, and this guide will walk you through it.
How to Register Your Business in Ontario?
Step 1: Choose Your Business Structure
This is an important decision that will impact your taxes, liability, and overall operations. Here are the main options for Ontario businesses:
- Sole Proprietorship: This is the simplest structure, ideal for freelancers and single-owner businesses. You and your business are legally one entity, and you report business income on your personal tax return.
- Partnership: If you’re joining forces with one or more partners, a partnership might be your pick. Profits and losses are shared according to the partnership agreement. There are different types of partnerships, so consult with a professional if needed.
- Corporation: This is a separate legal entity from its owners (shareholders). Corporations offer limited liability protection to owners, but they also come with more complex regulations.
Step 2: Register Your Business Name
Unless you’re operating under your own legal name (sole proprietorship), you’ll need a catchy business name. Conduct a NUANS name search through ServiceOntario to ensure your desired name is available.
This search typically costs around $25. Once confirmed, you can register your name online for a fee of $60 for a sole proprietorship or general partnership, and $210 for a limited partnership.
Step 3: Obtain a Business Number (BN) from the CRA
The Canada Revenue Agency (CRA) issues a BN, a unique 9-digit identifier used for tax purposes.
You can register for a BN online for free. Having a BN allows you to collect HST (Harmonized Sales Tax) if applicable, and simplifies filing business tax returns.
Step 4: Register for HST
Most businesses in Ontario that make over $30,000 annually must register for HST. You’ll then collect HST on your sales and remit it to the CRA. You can register for HST online when you register for your BN.
Step 5: Explore Municipal Licenses and Permits
Depending on your location and business activity, you may need additional licenses or permits from your municipality. Contact your local municipal office to inquire about any specific requirements.
Conclusion:
While not mandatory, business insurance protects your company from financial losses due to unexpected events like property damage, liability claims, or even business interruptions.
Important Note: This is a general guide, and specific requirements might vary depending on your business type and industry. Don’t hesitate to consult with a business advisor or accountant for personalized advice.