Whether you decide to Federally or Provincially Incorporate is solely a personal choice; both are available to you for incorporation. Ontario Business Central has years of experience completing both Canada/Federal and Provincial Incorporations.
Here are general reasons why individuals seem to choose a Canada/Federal Incorporation rather than a Provincial Incorporation:
The first decision is whether to incorporate a numbered or named incorporation.
The Federal government will provide a 7 digit number from your submission when you select a numbered corporation with the word Canada and a chosen legal ending.
Example: 1234567 Canada Inc.
Often a numbered corporation is selected when
This is when you wish to advertise a business name for your corporation.
Example: DEF Holdings Inc.
Often a named corporation is selected when
Choosing a Legal Ending
There are a number of options available for the legal ending of your incorporation including Inc., Incorporated, Ltd., Limited, Corp., or Corporation. You may choose whichever ending suits you or sounds preferable with your business name.
Additional Information Required for Incorporation:
Ontario Business Central begins the processing on a same day basis. Typically, it takes 1 to 2 business days to complete the incorporation with the Federal government examiners. We offer rush services for Canada/Federal Incorporations where if processing with the Federal examiners is completed before 1:00 pm on any business day, we will receive confirmation and completion on a same day basis.
Choosing a corporate name for your business can be one of the most difficult things to do. To make it easier for you, we break it down into four primary elements:
Distinctive Element: This is usually the first word identifying something about your business and what you wish to convey.
Descriptive Element: This provides what products or services relate to your business. It is much easier for clients to find you when your business name includes what you are providing.
Legal Element: Choose whichever legal ending suits you or sounds best with your business name. The options are listed within the website.
Specific Business Name Requirements for a Canada/Federal Incorporation: It is very important when incorporating a Canada/Federal Incorporation to ensure you choose a very unique business name and provide a descriptive element to that business name. The name protection available with a Canada/Federal Incorporation is only secondary to the Trademark registration in Canada (highest level of name protection available within Canada). In choosing to incorporate a Canada/Federal Incorporation, the scope of existing business names throughout Canada is much larger than with a Provincial Incorporation. The business name you choose will be reviewed against similar business name conflicts across most Provinces. Ontario Business Central has been assisting individuals for many years to gain approval of their business names and often will assist to strengthen the business name for acceptance with the Federal examiners.
A NUANS report is a mandatory 7 page report required when incorporated within most jurisdictions in Canada. It is very important that you order the NUANS report specific to the jurisdiction where incorporating. With a Canada/Federal Incorporation, a Federal NUANS report is required. The report provides a listing of small businesses, corporations, and trademarks that are similar to the name you wish to incorporate.
A pre-search is commonly completed. This is a search of the proposed business name to see if it is available prior to ordering the 7 page NUANS report. If a name is not available, additional names may be provided.
The Federal pre-search and NUANS report are preselected for you within our incorporation packages.
The NUANS report is provided to the Federal examiner with Industry Canada for review and acceptance along with the incorporation documents.
Sometimes the decision between completing a Canada/Federal Incorporation to a Provincial Incorporation may seem difficult.
Here are highlights of some differences between comparing the two different options:
A Canada/Federal Incorporation provides
A Provincial Incorporation provides
When a Canada/Federal Incorporation is completed, a secondary filing must be completed within the Province or Territory where the business is physically located.
Often, there are additional fees to bring a Canada/Federal Incorporation into the Province or Territory selected. Some Provinces have the availability to request the Provincial registration as the Canada/Federal Incorporation is being completed. Other Provinces and Territories require manual filings.
The minute book is an organizational tool for your new corporation. It provides the share certificates, and tabs for officers, directors, and shareholders of the corporation along with other supporting documents. We recommend it if you have partners. The minute book should be updated each time you have a change within your corporation.
The Mark Maker Seal is an embossed impression with your corporate name and jurisdiction where you have incorporated. The seal is commonly used when you are doing business transactions. The corporate supplies are listed as an option within our incorporation packages.
These accounts can be set up for free by going directly to the government contacts and websites. We provide you with each of these contacts along with many more to assist you as you begin your business.
HST (harmonized sales tax), formerly GST and PST, is mandatory only if your corporation grosses $30,000.00 or more within the same fiscal year. Until this income is met, HST is optional as is the set up of an HST account. As an example, the current tax rate is 13% within the Province of Ontario. When you operate a business and have an HST account, the HST you pay out for business expenses is subtracted from the HST you take in from clients and customers. Each quarter, a tax filing is required to Revenue Canada providing the difference between the two.
Sometimes, it may be beneficial to wait to set up an HST account to offer clients and customers a no tax incentive for your business. Other times, where you have a large number of expenses to set up your business, it may be beneficial to set up an HST account right away.
Payroll is to be set up whenever you begin employing individuals within your business.
A tradename is a Master Business Licence (small business) operating under an incorporated company. This may be an option for you if you wish to operate a secondary business name or the same name as your corporate name without the legal ending for such things as signage. The tradename is only available at the Provincial or Territorial level. The Canada/Federal Incorporation must be brought into the Province or Territory prior to registering the tradename.
ABC Holdings Inc. carrying on business as DE Restaurant (operating a secondary business name)
ABC Holdings Inc. carrying on business as ABC Holdings (for signage, advertising where the corporate legal ending of Inc. does not appear)
1234567 Ontario Inc. carrying on business as ABC Holdings (operating name under corporation)
Important Things to Know About Tradenames:
Tradenames can be added within your incorporation package with us.
Once your Canada/Federal Incorporation has been completed, you will receive the BN number from Revenue Canada to your corporate head office address. The BN number is similar to your social insurance number as an individual. The BN number is used for all tax accounts with the Federal government including corporate tax, HST, and payroll. Once you have received the BN number, you may go to Revenue Canada's website (we will provide you all of the details) and set up HST and payroll accounts when applicable.
After Setting Up a Completed Incorporation:
Ontario Business Central provides a free bizguide with each completed incorporation. This guide provides relevant information on taxation, organizing your business, dealing with employees, associations, Canadian business support services, and so much more.
There is also additional information within our blog articles (see links below). Please feel free to contact our office for any additional questions you may have.
We are available Monday through Friday 9:00 am to 5:00 pm.