While it might sound really easy to hang your shingle online and start accepting customers, it takes a bit more than that to open a business in Canada. One of the pieces that some don’t understand is how to register a business with the Canadian government.
Today we’re going to look at how to register a business.
Quick guide to registering your business
It’s best to have your legal responsibilities sorted before you accept your first client or sell your first cupcake. Just follow these steps.
- Prep for registration.
- Get a business number.
- Register for GST/HST numbers.
- Additional requirements.
Now let’s walk through each of these four steps in turn.
1. Prep for registration
Before you can register your business, you need to:
- Decide what type of business you want to have (sole proprietorship, corporation, etc.)
- Choose a great name for it
Photo: Tj Holowaychuk on Unsplash
Make sure to check the names you come up with against the national name database to ensure you can use it. You should also use the business name search for your province to make sure there isn’t a similarly named business near you.
In almost every case, if a name is already in use, you can’t use it if you’re in the same industry. You are also barred from using any marks that are similar to those of existing businesses.
2. Get a business number
The next step is to get a business number (BN). This number is used to identify your business to all the levels of the Canadian Government, from municipal all the way up to federal.
In Quebec this is called an NEQ (details here). For all other jurisdictions you’re going to register for a BN, which will be used for your:
- GST/HST
- Payroll deductions
- Corporate income tax
- Any import/export needs
All incorporated businesses must have a business number, as does as any business that needs a Canada Revenue Agency (CRA) program account.
What you’ll need
To start the process of getting a Business Number, you’ll need four pieces of information:
- Last name
- Social insurance number (SIN)
- Date of birth
- Postal code for the address where you live
That’s the easy part. To register a business online, you’ll also need these details:
- Business name
- Business number (if you already have one from an offline registration)
- Type of business or organization
- Name and SIN of the owner(s) of the business
- Physical address
- Mailing address (if it’s different than the physical address)
- Description of what your business does
Be sure to assemble all the relevant details before you sit down to make your business official.
3. Register for GST/HST numbers
Photo: Blake Wisz on Unsplash
Once you have your business registered, you’ll need to get a GST/HST number so you can charge taxes to your customers inside Canada. You’ll need all of the information you’ve already gathered for your online business registration for this.
Not all businesses in Canada are required to have a GST/HST number.
Some businesses, such as small suppliers, fall into the exemptions provided by the CRA.
The first few years of my business, I didn’t have to get a GST number. But as my sales increased, my accountants told me that I was no longer a small supplier and needed to get a GST number. They even took care of registering me for a GST number because they had all my information already.
4. Additional requirements
Some provinces and territories have additional requirements for your business registration.
Municipal requirements
One of the final things you’ll need to look at as you register your business is any municipal business licences that are needed. I have to pay a yearly fee of around $100 to have a business licence, even though I don’t really work for anyone in my city and never have clients over at my house.
To figure out what I needed the first time, I simply searched for my city and the words “business licence.”
That brought up all the information I needed to register for a business in Chilliwack. I was able to get it done in about an hour by heading down to the proper building and paying a few fees.
Other permits and licences
Some businesses will also need different permits and licences to be able to operate due to the specific business that they do.
For instance, in BC you’ll need to get land use permits if you are doing business with:
- Mining
- Forestry
- Agriculture
- Land and water
Use the FrontCounter BC website to figure out exactly what you need.
In Alberta, you’ll need to understand the Fair Trading Act as it applies to your business, and get any other licences you need to operate.
Other provinces and territories in Canada will have different rules, so make sure you’re familiar with the permits and licences your business will need in your province.
That’s how to register a business online
If you’re just looking into starting a business, I’m sure all of this information feels overwhelming. It certainly did to me at first. But I finished out the first day of getting set up realizing that it was much easier than I thought it would be.
As I’ve already said, it only took a few days to get my business registered and get a Business Number and municipal business licence. Then as my business grew I got a GST number.
Learning how to register a business was the easy part of getting my company off the ground and profitable. Time to start your own adventure!
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