How to Incorporate a Limited Company/ Corporation in Canada
There are two types of corporation in Canada, corporations formed under provincial law and corporations formed under federal law.
- Federal Incorporation:
- If you incorporate federally your corporation will be able to conduct business in all Canadian provinces
- Federal incorporation will allow you to use the same company name in each province and no company in any other province would be able to register a corporation with a name the same, or deceptively similar, to yours.
- Provincial Incorporation:
- If you incorporate provincially, your corporation only has the right to carry on business in the Canadian province where your business is incorporated and overseas.
- If you are planning to do business in only one Canadian province and overseas, there is no need to incorporate federally.
Corporation names in Canada have to be distinctive and identify the particular corporation, the Registrar of the provincial Registry and the federal Corporations Directorate both require that the name is unique and not similar to, nor the same as, any other registered company.. The name must also be descriptive and identify the particular business activity of the corporation. The name must also contain a legal element with an affix that identifies the company as a corporation e.g. 'Limited', 'Incorporated', 'Corporation', etc. Corporate names in Canada can be in English, French or in a combination of both languages.
If incorporating federally, or in provinces such as Ontario, you will need to have a NUANS search done and then submit the NUANS report.
In other provinces, such as B.C. and Nova Scotia, you must have a name search done once a Name Approval Request or Name Reservation Request Form is completed. If the results of the search are acceptable it is then reserved for a limited time during which the incorporation process must be completed.
To incorporate your business the following incorporation documents will need to be prepared:
- The rules and regulations that will govern the conduct of the company its shareholders and directors
- A Memorandum setting out the rules for the conduct of the company
- A Notice of Offices stating the location of the requisite offices for your corporation: the registered office and the records office
- When incorporating federally a Notice of Directors must also be completed.
For provincial incorporations, the specific requirements for each document type may differ; Formacompany advise and help draft all documents as part of our standard incorporation package.
Once these documents have been filed you will receive your certificate of incorporation and your new corporation will be ready to trade.
The organization of the corporation will be achieved by a meeting of the corporation’s directors or shareholders or by written resolutions which are signed by all the directors or shareholders. During this first meeting you will:
- Formally approve and adopt the documents of incorporation and formally approve and adopt the corporate bylaws
- Elect directors
- Appoint company officers
- Issue shares to shareholders
- Formally approve and adopt any other organisational resolutions to organize your corporation
It typically takes only two weeks to incorporate your new company.
Formacompany has over 20 years’ experience forming companies in Canada and across the world, and our staff will be available to offer advice and support through the entire incorporation process, from initially selecting a suitable company name through to finally commencing taxable activities.
What you need to set up a corporation in Canada
To begin incorporation of your Canadian corporation we will require the following:
- The company name
- The full name, date of birth, address and nationality of all directors
- The full name and address of all shareholders
Documents you are required to provide:
- Proof of identity (passport, national identity card, photographic driving licence).
- Proof of residential address (gas/electricity bill or credit/debit card bank statement dated within the last three months)
Corporate Account and Requisite Licences
- A corporation must have its own corporate bank account. The bank will require copies of certain incorporation documents, such as the Articles of Incorporation, and may require that particular banking resolutions are passed and documented.
- To get other permits or licenses your corporation will need its unique Business Number, issued by the federal government for your GST, corporate income tax, import/export taxes and employer payroll source deduction accounts.
- The corporation may need to register for PST for collecting and remitting provincial sales taxes, for Workers’ Compensation Insurance, for provincial Employer Health Tax, and for other provincial and/municipal licenses.
- All corporations must have a registered agent and a registered office. The registered office is where documents may be legally served on the company. The registered office must be a physical address in Canada; we can provide this for you as part of the standard incorporation package.
- The law requires that certain corporate records should be maintained and kept at the registered office. It is a mandatory requirement that you keep and maintain a Corporate Minute Book which will include all important documents, such as:
- A directors’ register.
- A shareholders’ register.
- A securities register.
- All corporate bylaws.
- Minutes of all company meetings.
- Copies of any forms filed with the government.
The corporate bylaws are a set of regulations stating how the corporation will govern itself and must including the rights and obligations of the corporation’s officers.
Ready Made Companies
- We have shelf companies in Canada currently available, with a standard Memorandum and Articles designed to permit most general activities; making it possible to commence business at very short notice. Our ready made companies are in good standing, are not the subject of any insolvency proceedings and have not entered into any contracts or engaged in any business activities.
What it costs to set up a corporation in Canada
Setting up a limited company in Canada will cost £2800--; this includes all duties, taxes and professional fees.
What you receive after setting up your new business
- Original Certificate of Incorporation
- Original share certificates
- Original government receipt as evidence of payment of annual company registration and license fees
Important information about incorporating a corporation in Canada
- The corporation must prepare and maintain accounting records. There are no requirements for accounting records to be open for inspection by shareholders however financial statements must be made available. This is to ensure that shareholders can obtain information regarding the financial situation of the corporation.
- Upon request, a corporation’s shareholders and creditors may examine the following records:
- Articles of Incorporation, company bylaws and their amendments also any unanimous shareholder agreements
- Minutes of meetings and resolutions of shareholders
- Copies of the Initial Registered Office Address, the First Board of Directors, Changes of Registered Office Address and any changes regarding directors
- Share register showing the names and addresses of all shareholders and details of the shares held
- Only one director of any nationality, is necessary for your corporation
- Only one shareholder of any nationality, is required