How do I register my business?
Registering a business in Ontario is relatively straightforward, but first you need to decide if your business structure will be a Sole proprietorship, partnership, corporation or co-operative.
Once you’ve settled on your business structure, the first step of registering your business is name reservation. You can apply for up to three names on one application, and you should thoroughly research your name choices and then proceed to register at Business services | Ontario.ca
Do I need to register a business?
As an individual, you don’t need to register a business name – you can always conduct business under your personal name. Registration of a business as either a sole proprietorship or partnership does have certain benefits though. Business names are useful for marketing purposes, and also allow you to accept and make payments with your bank under a business name.
How do I decide what business structure is right for my business?
The simple answer to this question is “it depends.” What business structure you choose will depend on many factors and there are no simple rules for selecting which will be right for your business. Some questions to consider include:
- How many people are involved with the business?
- Are there outside investors?
- Do you have any personal assets you wish to keep separate from the business?
- Do you want to limit your liability?
- How much profit is the business expected to generate?
- How much do you wish as a salary?
- Will you be re-investing profits in the business, or do you want to take all profits as personal salary?
- What is your budget for registration?
- Are you prepared to pay the additional accounting fees required by corporations?
You have to investigate the different options and decide what makes the most sense for your business. An accountant and a lawyer can help you make an informed decision.
How can I switch from a partnership to a proprietorship?
Changing from partnership to proprietorship requires a new business registration. This includes resubmitting a business name request, as well as a new registration (see “How do I register my business?”). You must also submit a dissolution form (see “How do I close/dissolve my business?”).
Federal incorporation gives your business increased business name protection and wider rights to conduct on business. You may also opt for federal incorporation if you plan on conducting operations in multiple provinces.
The downsides to federal incorporation are extra paperwork, and additional costs to register the federal entity in every province where you conduct physical operations.
For more info please see Corporations Canada Frequently Asked Questions.
How can I protect my business name?
You have two options to protect a business name:
- Register the business as a corporation. You can either register your corporation at the provincial level (see “How do I register my business?”) or at the federal level. If the corporation is a provincial corporation, the name will only be protected at the provincial level. If the corporation is a federal corporation, the name will be protected at the national level.
- Register the business name as a trademark. For more information on trademarking, visit www.cipo.ic.gc.ca.
How can I switch from a proprietorship to a corporation?
You can’t switch from a proprietorship to a corporation because they are different legal structures. A proprietorship is simply an individual operating under a registered business name or under their legally given name, whereas a corporation is a separate legal entity from the individual who owns the business, and is in turn owned by its shareholder(s).
A sole proprietor can choose to incorporate (see "How do I register my business?") at any time and can subsequently dissolve their registered proprietorship (see "How do I close/dissolve my business?"), or keep it on record while operating their business under as corporation.
What kind of business licensing do I need?
Most municipalities in Ontario require you to obtain a business licence, which gives you permission to operate your business on your premises (whether in your home or in a commercial space) within that municipality. In some instances, you may be required to obtain a licence in municipalities where you do not maintain premises but do carry on business.
Contact your local city hall – as well as the city hall in each community where you’re doing business – to see which permits (including mobile business licences) might be required for your type of business. Please note that additional federal, provincial, and/or municipal regulations may apply to your particular business. Consult the appropriate authority or visit www.bizpal.ca for more information.
How can I finance my business?
One reason that small businesses fail is because they undercapitalize their business, so it’s important to know how much money you will actually need to start and to run your business until you reach your break-even point – the point when your sales revenue equals your total expenses.
Your financing options will vary depending on how much you need to borrow.
You can begin investigating your options here:
Specialized financing options:
How do you write a business plan?
A business plan will have eight key sections, including:
- Executive Summary
- Identify Opportunities
- Market Research
- Marketing and Sales
- Your Team
- Financial Forecasts
- Implementation Plan
For more information on how to compile your business plan refer to following business plan templates:
- Scotia Plan Writer
- Futurpreneur Business Plan Writer
- Business Development Bank of Canada Templates
What do I need to do before I hire my first employee?
You can find information about employment regulatory issues through the Employment Standards Act Ontario . They provide hiring and firing guidelines, information about minimum wage, vacation entitlement, break schedules, overtime, and much more.
It is mandatory that you register with Workplace Safety and Insurance Board for your employees. WSIB coverage protects employees who are injured on the job, and the premiums are employer paid.
You will also need to set up a payroll deduction account under your Business Number with Canada Revenue Agency (toll-free: 1-800-959-5525). A payroll deduction account is where you – the employer – deposit all the E.I., CPP and income tax deductions you collect for payroll.
The actual hiring process is very important – you don’t want to make costly hiring mistakes. If a new hire does turn out to be a poor fit, it’s in the best interest of both you and the new employee to terminate.
Here are the basic steps for hiring a new employee:
- Determine your needs – Do you need an admin assistant? A salesperson? A marketing manager? A social media guru?
- Write a detailed job description
- Post the job where you think you’ll attract the best possible candidates
- Shortlist the applicants
- Interview the applicants
- Select the successful candidate
- Onboard your new employee with training and orientation
You may want to have an employment recruiting or temp agency help you with this process.