There are advantages and disadvantages to both legal entities, depending on your personal risk and liability, client base, investments to the business and the amount of revenue expected to be generated, each has its merits and limitations.
|Description||Master Business Licence||Incorporation|
|Liability Risk?||Personally liable for business damages||Limited Personal Liability|
|Taxation?||Personally taxed||Possible tax advantages|
|Name Protection for Business?||Not available||Provided with Incorporation|
|Continuous Existence?||No. Requires renewal and fees every 5 years||Yes|
|Transferable Ownership?||In most cases, no||Yes|
|Access to Capital?||Limited access to capital||Greater access to capital|
|Flexibility to Change Name, Address, or Individuals Listed?||Address or general partnership to general partnership change||Very flexible. Can change any aspect|
|Requirements for Taxation?||Filed under individual tax return||Separate filing from Individual|
|Start up costs?||Lower - starting $132 +taxes||
Higher - $443 +taxes (Federal)
$558 +taxes (Ontario)
All jurisdictions for incorporation offer the following:
There are advantages and disadvantages to both legal entities. Depending on the importance of name protection within Canada, name accessibility to register the corporation in other Provinces, the interaction of foreign individuals/corporations, the administration requirements each format of incorporation has its merits and limitations.
The differences between the jurisdictions available for incorporation are as follows:
|Federal Incorporation||Ontario Incorporation||Alberta Incorporation||British Columbia Incorporation||Saskatchewan Incorporation||Manitoba Incorporation|
Government fee of $200
Government fee of $360
|Government fee of $275||Government fee of $350||Government fee of $222.75||Government fee of $350|
|Yearly mandatory filing to remain active||Only one mandatory filing after incorporation||Yearly mandatory filing to remain active||Yearly mandatory filing to remain active||Yearly mandatory filing to remain active||Yearly mandatory filing to remain active|
|Higher name protection within Canada||
Name protection in Ontario only
|Name protection in Alberta only||Name protection in British Columbia only||Name protection in Saskatchewan only||
Name protection in Manitoba only
|Higher foreign recognition||Limited foreign recognition||Limited foreign recognition||Limited foreign recognition||Limited foreign recognition||Limited foreign recognition|
|Name approval process?|
|Name must be accepted by Federal Examiner||Easier name acceptance||Name must be accepted by Provincial Examiner||Name must be accepted by Provincial Examiner||Name must be accepted by Provincial Examiner||Name must be accepted by Provincial Examiner|
|Director residency requirements?|
|Federal - 25% of directors must be Canadian Citizen or Permanent Resident||Ontario - 25% of directors must be Canadian Citizen or Permanent Resident||
||There is no minimum percent/residency requirement. A Non-Resident may be the sole director.||
Saskatchewan - 25% of directors must be Canadian Citizen or Permanent Resident
|Manitoba - 25% of directors must be Canadian Citizen or Permanent Resident|
|Timeline to Incorporate|
Federal - Typically takes 2 business days to complete.
|Ontario - If ordered prior to 3pm on a business day, completed same day.||
Alberta - Tiered pricing. Depending on how fast you wish to receive it back.
British Columbia - Tiered pricing. Depending on how fast you wish to receive it back.
Saskatchewan - Tiered pricing. Depending on how fast you wish to receive it back
Manitoba - Tiered pricing. Depending on how fast you wish to receive it back.
A Master Business Licence is a business licence issued by the Provincial Government that allows individuals or a Corporation to operate a business name for 5 years. There are three types of Master Business Licences; a sole proprietorship, a general partnership and tradename under a Corporation.
A sole proprietorship is an individual in business alone.
A general partnership is a minimum of 2 or more individuals in business together.
A tradename is commonly referred to as an 'operating as name' under a Corporation. This allows a Corporation to operate a name that is different than the legal Corporation name.
After a Master Business Licence is past expiry, there is a 60 day grace period to be able to still renew. After this timeframe has passed, we can no longer renew. A new registration can be submitted in its place after the final expiry.
Yes. They are both common terms for the same licence.
Master Business Licences do not have the flexibility to change their legal name. A new licence would have to be registered if you wish to make a name change.
Corporations do have the option to make name changes. We can assist with filing Articles of Amendment/Corporate Amendment to make changes to the Corporation legal name.
Yes. We can assist with filing either a Master Business Licence address change or Corporation address change.
Any business that is operational must be registered with the Provincial or Federal Government to be able to operate. The only time, it is not required, is if you are using your legal name only.
Ex: JOHN SMITH
Yes. When filing in your form, you would simply provide the new address you wish to have listed.
A tradename is an operating as name under a Corporation. We can assist with this type of registration.
A trademark is the highest level of name protection available in Canada. This is usually used for slogans or logos. A trademark is not a business registration. We cannot assist with this type of registration. This would be registered through a trade marking agent.
A corporation is a legal entity that establishes a business within Canada. This can be a Provincial, a Territorial or a Federal Corporation. It is continual. It is a separate entity from the individuals who own the business, there is limited personal liability and the Corporation has its own taxation.
There is no legal requirement that you must use a Lawyer, however if you have specific requirements, or are unsure, Ontario Business Central Inc. is not a law firm and cannot provide a legal opinion or advice.
A Nuans report is a name reservation report required when incorporating or changing the name of an existing Corporation. This report is valid for 90 days. This report must be ordered for the jurisdiction to which the corporation will be in.
Ex: Ontario Corporation requires an Ontario Nuans.
No. A Federal Nuans can only be used for Federal Corporations.
This information is to assist you in understanding the requirements of registration within the chosen jurisdiction. It is always recommended, when you have legal or accounting questions that you speak to a qualified professional.
There is no difference of which legal ending you use. You would simply use the one you prefer the most. In most Jurisdictions in Canada the standard legal endings are as follows:
A director is typically a person who manages the corporation. Typically they make the business decisions on behalf of the corporation. Any director must be at least 18 years of age.
An officer is usually an individual holding senior management positions within a Corporation. Common positions are President, Secretary and Treasurer.
A shareholder is a person who holds share(s) within a corporation. They are typically owners, however may be a family member or investor. Typically shareholders have a financial stake in the corporation and the shares reflect at what percentage. A corporation must have a minimum of one shareholder.
Yes. Commonly an individual is sole director, officer and shareholder for a Corporation.
They can be. It depends on the shares issued by the Corporation.
It is a mandatory filing due 60 days after Incorporating. This list the officer titles to the Province. If it is not filed, the Province may cancel the Corporation.
There is a simple form to file when you wish to add, remove or update director addresses. We can assist with filing the Notice of Change.
An annual return for a Corporation is a mandatory yearly filing required by most jurisdictions to remain active. Noted below is a table confirming if required for the Jurisdictions for which we offer corporate registration.
|Ontario||No. Only mandatory filing is Initial Notice. Due 60 days after Incorporating.|
|Federal||Yes. Due within 60 days of its anniversary month. After 2 consecutive years, there is a final warning with 120 days to file. If not filed, the Government will dissolve the Corporation.|
Yes. Due at the end of the anniversary month. After 2 consecutive years, if not filed within 6 months the government changes status to struck.
|British Columbia||Yes. Due within 60 days of its anniversary month. If not received within 2 months, will be considered not in good standing. After 2 consecutive years, if not filed may be canceled.|
|Manitoba||Yes. Due end of anniversary month. After 2 consecutive years, if not filed will be canceled|
Yes. Due one month after the anniversary date of the incorporation. If late, subject to additional fee.
If not received within 2 months, will be struck.
A BIN number is a business identification number issued by the Provincial Government to a Master Business Licence.
A BN number is a business tax number issued to a Business Registration (Master Business Licence or Corporation) by Revenue Canada.
No. A corporate number is issued by the Provincial, Territorial or Federal Government when a corporation is registered. An HST number is issued by Revenue Canada for taxation.
A registered agent or agent for service is a person that accepts responsibilities on behalf of the Corporation.
We accept Visa, MasterCard, Amex, Visa-Debit and MasterCard debit.
If you cannot process in this manner, we also accept e-transfers or direct deposits to our bank (if you wish to use one of these options, please call in for additional details).
We have been incorporated for 25 years. We have served 150,000+ customers and have registered over 95,000 new businesses.