How to Register an Ontario Incorporation: A Complete Guide

If you want to Incorporate in Ontario, Canada, you need to understand the process of

registering a business. Incorporation in Ontario is straightforward but has a number of

steps that must be undertaken for the business to be in compliance with the law. This

article will explain how to incorporate an Ontario Corporation step by step.

Why Incorporate in Ontario, Canada?

Incorporation in Ontario is the first step toward establishing a legal entity that can

operate within the province. Irrespective of the nature of your business—a sole

proprietorship, partnership, or incorporation—the process will establish the fact that the

name of your business is unique and that your company complies with local laws and

regulations. This not only enhances your credibility but also ensures the protection of

your personal assets from business liabilities.

Step 1: Decide on the Type of Business Entity

Before you move ahead with registering your business in Ontario, Canada, you need to

zero in on the type of business entity that you will be setting up. The most common

types are:

Sole Proprietorship: This is the simplest form of business registration in Ontario. It

involves registering your business name and operating under your own name or a trade

name.

Partnership: This describes an association of two or more persons who share the

business's profits and liabilities.

Incorporation: This is the most complicated way of registering; it has immense benefits

like limitation of liability and possibly some tax advantages if you operate in Ontario.

Step 2: Choose a Business Name

The second step toward incorporation in Ontario, Canada, is selecting a business

name. A business name is very important as it is an identification for your brand; in fact,

it appears on each and every document legally prepared. During the incorporation for

your Ontario business, you should take consideration to provide a name which does not

exist with any other business.

How to Choose a Business Name:

● Uniqueness: The name should not be too similar to existing Ontario businesses.

● Descriptive: The name should describe the nature of your business.

● Compliance: The name should meet Ontario's incorporation naming

requirements, so you have to avoid prohibited terminology.

Step 3: Name Search

Before being able to proceed with incorporation, the name must be approved. The

business will be allowed to register only when it is possible to confirm its name via the

Ontario Business Registry.

How to Perform a Name Search:

● Open the Ontario Business Registry website.

● Use the "Name Search" tool to determine if your proposed business name is

available; once the name is available, you can reserve it for a specified period

before continuing with the incorporation.

Step 4: Business Name Registration in Ontario

Once you have picked a name and verified its availability, the next step involved in

incorporating your business in Ontario is to officially register it with the appropriate

authorities. How this is done, of course, varies depending on what type of business

entity you are about to register.

Registering a Sole Proprietorship or Partnership

● Business Name: Your business name can be registered online through the

Ontario Business Registry.

● Fees: The registration fee is quite minimal in the case of a sole proprietorship or

partnership.

Incorporation in Ontario

● Articles of Incorporation: For incorporation in Ontario, one is expected to file the

Article of Incorporation. This document lays down the organizational structure of

your incorporation, including names of directors and shareholders.

● Ontario Business Number (BN): When your corporation is registered you will be

issued an Ontario Business Number for your corporation.

Ontario Standard Corporation

An Ontario Corporation is a company registered with Service Ontario under Ontario

Business Corporations Act (OBCA). It can legally carry out business activities in

Ontario. One of the key benefits of incorporating as an Ontario Standard Corporation is

limited liability protection for shareholders and corporation’s name protection in Ontario.

What are the benefits of Ontario Corporation?

● One of the primary benefits of incorporation is limited liability protection.

Shareholders of an Ontario corporation are typically not personally liable for the

debts, liabilities, or obligations of the corporation. This means that personal

assets of shareholders are generally protected from business-related risks and

creditors.

● You can easily make changes in your corporation: change the name, change

corporation structure, etc.

● Ontario incorporations may benefit from certain tax advantages, including the

ability to access the small business deduction rate on active business income,

which is lower than the general corporate tax rate.

● The incorporated company can continue to exist even if shareholders change or

pass away.

● Incorporated businesses may find it easier to raise capital and attract investment

compared to sole proprietorships or partnerships. Investors and lenders may be

more willing to invest in a incorporation due to its limited liability structure and

potential for growth.

Who can Incorporate?

● One or more individuals above the age of 18 can conduct an incorporation in

Ontario.

● Must have a physical address in Ontario. If you don't have a local provincial

address, we provide registered address and mail scanning service.

● No residency requirement to incorporate in Ontario.

What are the incorporation steps?

Step 1. Name your corporation.

Choose if you want a numbered or a named corporation:

● A numbered name is the simplest way to name your incorporation because the

government assigns the number (for example, 12345678 Ontario Inc.).

● Your company can be named and have a unique name that sets you apart from

your competition.

● Please include the legal suffix like Inc./Ltd./Corp. at the end of your name. It is

vital for incorporation.

● An Ontario NUANS Reservation Report is required to register a Named

Corporation. You can obtain a NUANS Report here: https://ontario-

business.ca/product/nuans-reservation-report/

Other recommended service providers that are registered NUANS members:

https://incorporationpro.ca/product/nuans-report

https://incorpmastercanada.ca/product/nuans-report/

https://mdlegals.ca/product/nuans-report/

For further details on the regulations for naming a corporation, please refer to this

link:

https://ised-isde.canada.ca/site/corporations-canada/en/naming-corporation

Step 2. Select your articles of incorporation:

This step establishes the structure of your incorporation. Choose the right share

structure:

● Basic one with unlimited common shares with no specific share class.

● Standard: common shares with class A voting and class B non-voting.

● Custom: this share structure allows to categorize shares into many types such

as common, preferred, voting, non-voting etc.

Step 3. Establish the office address.

● Registered office address must be a physical address in Ontario.

● Mailing address can be a P.O. BOX.

● You are allowed to have a legal land description address too but must have a

P.O. Box connected to it.

● If you don't have a local provincial address, we provide registered address and

mail scanning service: https://ontario-business.ca/product/registered-office-

address/

Step 4. Decide who will be a director, shareholder, officer and Incorporator.

Director - is the head of the incorporation. You can add up to 10 directors.

Shareholder - owns the incorporation and receives profit from the business as

dividends and shares.

Officer - is anybody including an employee, no decision making power.

Incorporator - is the person under whose authority the incorporation is made. Is not

changeable.

Mandatory items to incorporation.

● Minute book: consists of bylaws, share structure, minutes & other legal sections.

Without it, an incorporation is not possible. https://ontario-

business.ca/product/corporation-minute-book/

● Initial Return. It's a mandatory filing with Service Ontario for each new

incorporation. It has to be filed within 60 days of Incorporation. It confirms the

details of the corporation. It is not a tax filing with CRA. https://ontario-

business.ca/product/initial-return/

● Business Number. It is a unique identification of your business with the Canada

Revenue Agency. It is required to register accounts like GST/HST, Payroll,

Import/Export accounts.

● Corporate Tax ID. It is like a SIN number for a incorporation.

● HST Registration. Harmonized Sales Tax. If you are selling goods and

collecting HST you must have an HST account. every time a business incurs an

expense - be it rent or paying for goods - it pays HST, if you set up the account,

you can claim it back.

● Payroll Account. If you have employees, including yourself, you must set up a

payroll account. https://ontario-business.ca/product/payroll-system-set-up/

● Import/Export. If your goods or raw materials cross the Canadian border, you

are required to clear customs using the Import/Export account.

● WSIB Account. It's the Workplace Safety and Insurance Board registration. If

your corporation has employees (except directors and shareholders) you must

register for WSIB. https://ontario-business.ca/wsib-registration/

● Annual Return. A corporation must file its Annual Return with the Government

every year to keep it active. You may add Annual Return to your package to

avoid the risk of forgetting it. We will take care of it! https://ontario-

business.ca/product/file-corporations-annual-return-online/

You can find out more information about annual return here: https://ised-

isde.canada.ca/site/corporations-canada/en/business-corporations/policy-annual-

filings-canada-business-corporations-act

Documents Required

● Sole Proprietorship/Partnership: Form for business name registration, Proof of ID

● Corporation: Articles of Incorporation, Proof of ID, and Particulars of

shareholders.

Step 5: Licensing and Permits

Once you have your incorporation, you will need to obtain a few licenses and permits

based on the type of business and location in Ontario, Canada.

Some common kinds of Licenses and Permits:

● Business License: This is for the majority of businesses operating within

Ontario.

● Other Licenses: Depending on the type of industry or business, there are other

licenses required, such as health licenses for businesses related to food.

Step 6: Register for Taxes

Registering for the Business Number is an important step for your business registration

in Ontario, Canada. It lets you be all set for operating a legal business without any

tension.

Types of Taxes to Register For:

● Harmonized Sales Tax (HST): If your business has annual revenue greater than

certain threshold amounts, you are required to register to collect HST.

● Payroll Taxes: Payroll taxes will be associated if you have any employees.

● Corporate Income Tax: If you are incorporated, your incorporation is required to

be registered and file corporate tax returns each year.

Step 7: Open a Business Bank Account

After going through the incorporation processes above for your business in Ontario, you

are strongly encouraged to open a business bank account. It's incredibly easier to keep

track of your accounts and taxes when personal finances and business finances are

separated from each other.

How to Open a Business Bank Account:

● Choose a Bank: Choose a bank specializing in small business accounts.

● Submit the required documents: You will be required to provide proof of

business registration, identification, and in some cases other necessary

documents, such as Articles of Incorporation.

Step 8: Register for Workplace Safety Insurance

If you employ any worker, it's statutory that you register with a workplace safety

insurance based in Ontario, known as the Workplace Safety and Insurance Board

(WSIB). This is another important step for your incorporation in Ontario, Canada,

because it ensures that your employees are protected in case of injury at work.

Register with WSIB:

● Account Creation: You can register your business with the WSIB through their

website.

● Pay Premiums: The premium amount you will pay depends on the industry you

are in and the size of your payroll.

Step 9: Maintain Records and Stay Compliant

Once the incorporation is complete and operational, one needs to keep up-to-date

records and stay compliant with all regulations. This includes maintaining proper

financial records, paying your taxes when due, and renewing any licenses or permits

that are required of you.

Corporate Compliance:

● Annual Returns: A corporation needs to be registered, and an annual return

must be filed with the Ontario Business Registry.

● Keeping Records: Records must be kept for all business transactions,

employee data, and tax filings.

● Renewals: Ensure renewal for business name registration or other necessary

license renewals.

Some Usual Issues in Incorporation in Ontario, Canada

There is a general ease in the process of incorporation in Ontario; however, there are

some usual issues that any entrepreneur may have to face. Knowing about the

problems would help you prepare better and save from the potential pitfalls.

Some Common Issues:

● Selecting the Right Business Form: It might prove a little difficult to decide

whether to set up a sole proprietorship, partnership, or corporation. All have their

own pros and cons.

● Name Availability: To come up with a unique business name which hasn't been

used by any other person in the market is quite a challenging task.

● Compliance with Legality: It could be quite overwhelming to have knowledge

about and comply with all relevant laws of tax registrations, permits, and

licenses.

Conclusion on Successful Incorporation in Ontario, Canada

Registration of Business in Ontario, Canada, is one of the most vital first steps towards

setting up a successful business venture. Whether it's the initial start-up of a small sole

proprietorship or a major corporation, using the following steps to guide you will aid in

handling things rather simply.

When you understand the importance of every step you need to follow, from which

business structure is best for you, down to registering your tax obligations, your

business will be in a position to be legally compliant and in good standing when it

comes to operation in Ontario. Do remember that the process of incorporation of

business in Ontario is not only by law but also foundational for a reputed and successful

business.

Last-minute checklist for registering the business:

● Type of business structure—sole proprietorship, partnership, incorporation.

● Name search and reservation of the business name.

● Registration of the business in the Ontario Business Registry.

● Licenses and permits.

● Register for taxes (HST, payroll, corporate income tax).

● Open a business bank account.

● Register for workplace safety insurance (if applicable).

● Keep detailed records and stay compliant with regulations.

With these steps in this comprehensive guide, you will be on your way to successful

incorporation in Ontario, Canada. This establishes the road for long-term success.