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Company Formation Services in Canada

Since the past few years, Canada has been a viable destination for various commercial and business activities. These business and commercial activities has played an important role in the steady and sustainable development of various businesses and has ensured that new businesses are set up without any legal issues. The company formation services have also been a helping hand in providing various new opportunities for aspiring entrepreneurs in developing their business.

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Over the years, Canada has become one of the top most destinations for education, employment and business purposes. There has been a rapid large scale development of various business and trade activities. With the active support and guidance from local administration, various new businesses have been setup and has provided various new opportunities and avenues for people from across the globe. This has had a positive influence on the economy of the nation and has proved to be a major attraction for people from across the globe.



Some of the steps for Incorporation of various businesses in Canada are as follows.

Evaluation of a Business Plan

A proper Business Plan has to be evaluated which involves planning of various industrial and commercial activities. This is quite important as it helps in determining various new commercial businesses.

Choosing a Unique Name for Business

A unique name has to be selected before Registration of Business as it helps a great deal in creating a sense of exclusivity and also helps in creating better awareness of the company.

Registration of Business with Governmental authorities

Here the Business is registered with various Governmental authorities and has ensured transparency in conducting various business and commercial activities.

Application for various Business permit and Licenses

Various licenses are mandatory for the smooth legal operation of services. These licenses act as an approval from different governmental departments and helps to verify the intent as well as authenticity of the firm or company.

 Getting appropriate support and financing

National and Business support is the agency that provides necessary support and help regarding the financing of various businesses and new industries.

Legal Structures of the Company in Canada

If you are looking forward to starting a business in Canada, you must decide about the company’s legal business structure. Legal business structure means the form of business through which the company will operate in the market. Selecting a legal business structure for the company is the first and foremost decision to be made by the investor. Structure of the company is the base, on which business rules like company registration, taxation formalities, and another factor depends. There are several ways for starting a business in Canada among which the most famous form is “Limited Liability Partnership”, as this business form is not a taxable entity. Thus, you are not supposed to pay tax under this business form. Except for this business form, there are several business structures which can be selected as a business structure by the investor in Canada, like-

  • Sole Proprietorship
  • Partnership Firm
  • General Partnership Firm
  • Limited Partnership
  • Limited Liability Partnership
  • Branch Office
  • Corporation
  • Joint Venture
  • Cooperatives
Sole Partnership
Sole proprietorship allows a person to have full ownership of the business without the interruption of any other person. Owner of the company is solely responsible for all the activities conducted in the company. All the losses and profits incurred from the commencement of the business remains with the owner. He or she is liable for all the business obligations and debts incurred if any. In case of loss, the owner has the liability toward his full personal income and wealth. Therefore, to satisfy business losses all business and personal assets can be sold off. This is the least expensive and most easy business form, as a sole proprietor does not need to register for starting a business in Canada and if needed, then too, it is quite simple as compared to other business forms. As there is a single person controlling the business, thus, there is no conflict in decision making which makes this process easier. There is no requirement to make a heavy investment in this business; you can start with the minimum working capital.

All the income generated in sole proprietorship business is considered as personal income and taxed accordingly, thus, there is no need to file a separate company tax return. He or she is required to pay taxes by reporting their income through T1 income tax – benefit return. T1 form is filled in Canada by those who come under the tax bracket established by the government or had a capital gain enough to pay tax in a particular year or are planning to make Quebec Pension Plan (QPP) or Canada Pension Plan (CPP) payments on pensionable earnings of that year or want to get special benefit allotted for the self- employed people or to fulfil legal requirements.

Partnership Firm
A partnership is a business created between two or more people agreeing on the same terms and conditions to start a business. In this business, both or all the parties pool their own resources to operate the business. A partnership can be formed between individuals or corporations or trusts on mutual agreement basis. In a partnership firm, all the parties will share equal liabilities and profit, until and unless specified in the agreement. A partnership deed is formed on the basis of the terms agreed between the parties.

In Canada, there are three types of partnership firms; this division is done on the basis of liability of the partners. Helpline Group can assist you to follow your decision and can complete formalities to incorporate your business accordingly. Generally, the decision of choosing the form of business partnership is influenced by the tax charged on the income earned by the partner. All the partners are supposed to file the income tax return by themselves; a partnership firm is not bound to do so. In some cases, a partnership firm is asked to file the income tax return but in this case, also partners are not relieved from paying tax.

General Partnership Firm

A general partnership has two or more person to transact in a business with a common view. In this form of partnership, all the partners are supposed to perform their part of duties, as per the agreement formed between them that means all the partners are actively engaged in this business. Until and unless specified in the agreement formed between the partners, all the partners have the same business rights, same participation in decision-making process, same profit share and share equal liability also. A general partnership company formation in Canada is quite easy to establish and liquidate also, but it is not a child’s play to deal with legal complexities. Helpline group can guide and assist you in starting a business in Canada through the least possible paperwork with full exploitation of time.

Registration of this business form remains in existence for 5 years after which it has to be renewed. Registering a partnership firm in Canada gets quite easier and faster while working with Helpline Group, we can get all the paperwork done for registration and also incorporate the firm completed within a few days. The major drawback in this partnership form is that all the partners in the business have unlimited liability to the extent of their personal wealth. Helpline Group’s experts can Canada will provide all related information about the business. In Canada, general partnership laws are highly influenced by the laws of the province or territory under which that partnership business comes.

Limited Partnership
A Limited Partnership must have at least one general partner and can also have more general partners, who bear unlimited liability on their own shoulders. And other partners are limited partners or at least one partner should be a limited partner with limited liability. This majorly depends on the contribution given by the partners in the business. It is usually found that due to that factor of liability, Limited Partnerships are formed with a corporation, working as a general partner with other individuals working as limited partners. In Canada, a limited partner is also known as a silent partner, who just makes financial contributions in the business, his opinions about the business might be taken in the decision-making process but he himself cannot make any business decision.

In case, a limited partner takes part in decision making then he loses his title of limited partner and will be treated as other general partners of the firm. In Canada, it is often found that a limited partner is used just as a tool for raising money. Helpline consultants in Canada can guide you and provide you with all information regarding the legal issues in this business form, we can assist you in dealing with all business paperwork to make your agreement strong for a company set up in Canada.

Limited Liability Partnership
Limited Liability Partnership is the most popular form of company formation in Canada, through which a number of investments are made for international trade in Canada. Limited Liability Partnership (LLP) is a form of a general partnership under which liability of a general partner is also limited to an extent. General partners cannot skip from their liabilities but get safe to an extent. There are minimum 2 numbers of partners in this business structure but there is no maximum limit, and a company can also become a partner in an LLP firm. This business form is not considered as a taxable entity in Canada, thus, you are not supposed to pay any corporate tax on the profit earned. LLP is treated as a transparent company for charging tax which makes the partners liable to pay the tax from the income earned by them separately. In Limited Liability Partnership, if something goes wrong then the partnership firm can be held liable and the assets of the partner involved in the loss of the company will be at risk, thus, assets of other partners are safe.

In Canada, every province has its own rules for governing business in a particular territory and LLP is a new business form emerged in few areas of Canada, such as in Ontario and British Columbia this business structure is in practice. LLP is comparatively new in British Columbia (BC) as compared to Ontario, in BC any partnership structure can be converted into LLP or a fresh LLP can be established. Due to provincial differences in business operation LLP legislation can be enjoyed all type of business form in British Columbia but in Ontario and other provinces, LLP legislation is limited to regulated professions like accountants, lawyers, etc. Thus, for starting a business in Canada, you must not only know about the benefit of the structure but also know about the facilities provided by the government in that particular province for your selected business structure. It can be said, that the selection of business structure is not an easy task in Canada. Helpline Group’s consultants can provide you with the best details about the business and will guide you about how to start a company in Canada with your selected business structure.

Branch Offices

A foreign company can establish its branch office in Canada with the legal license provided by the Canadian government. A branch office must be registered under the province in which it will be operating. Helpline executives will guide in this regard and will also complete paperwork in order to help you in starting a business in Canada. Our native consultants have better knowledge of legal formalities in Canada. Branch office’s activities, rules and regulations everything depends on the province under which it comes, thus, the definition of “permissible business activities” defer from province to province in Canada, therefore, in Canada, a Branch Office business can conduct business activities as under-

  • A resident agent as a representative is hired to operate the business or a representative working in the office or company warehouse or any official place to conduct business.
  • Other than security, the parent company should have an interest in real property of that province.
  • Business activity can also be chosen by the governing laws of the province.

In Canada, Branch Office is having the privilege of tax benefit which makes them a popular business structure in Canada. According to the Canadian business law, all the activities of the Branch office make the parent company liable for the actions of the branch office including debts, liabilities and other legal obligations.

A corporation has a separate legal entity from its shareholders. In Canada, a corporation has legal recognition (as a natural person) through which it can own property in its own name, can take or give a loan, it can sue and can be sued by other people. Shareholders of a corporation have liabilities limited to the amount invested by them in buying shares, thus, shareholders do not have any authority on the assets of the company. A corporation has to file the tax return for every financial year and pay corporate tax accordingly. Company incorporation in Canada can be done at two levels i.e. either at the federal level or at the provincial level. Federal level incorporation of a company allows it to trade in any part of Canada whereas with Provincial level incorporation a company remains confined to a single region. If a corporation has federal registration then it can extend its province only by making application for provincial registration from the province in which you intend to have a business.

All the shareholders are the owner of the corporations and can make decisions by conducting the business meeting through votes. But ownership of a Corporation is not affected by the death of the shareholder or if he leaves the Corporation nothing gets affected, as the shares can be transferred to another person. The tax benefit is one of the core advantages for working in this structure, as shareholders in this firm can be anyone, thus, the owner can take shares in the name of family members or can issue dividends to them, which will redistribute income within the family. In Canada, if you qualify for “Small Business Deduction” then your corporation can avail a credit amount for your business which will reduce the payable tax amount.

Joint Venture
Joint Venture is a result of an agreement formed between two or more people or companies or other entities to work together for accomplishing a task. Both the parties contribute their resources either in the terms of finance or skill or goods or services or goodwill for attaining mutual benefit on completion of the task. Joint venture comes to an end at the completion of the task or after a defined time period or incapability of one or more party to perform the task or any legal requirement, etc. A joint venture is not a legal entity in the eyes of law; therefore it cannot operate a business in its own name. In this type of business structure, the entity dealing with the third party is held liable for the deeds performed.  The Canadian government has no law governing Joint Ventures; all the terms are based on an agreement with mutual discussion.

Although there is no specific law governing Joint venture, the Joint venture parties are required to work according to business guidelines provided by the Canadian government under the Act for Investment in Canada. Approval for having a Joint Venture is highly affected by the benefits derived from the agreement to the country, every province has their own way of analysing the agreement. Therefore, it can be said a joint venture not approved in one province might get approval in another province. Projects deriving benefits to the country like increasing productivity, increasing Canadian participation in the project, level of advancement, technological development, product innovation – development, industrial efficiency, etc. are highly preferred by the government.

Cooperative is legal incorporation which is owned by a group of people looking forward to satisfying specific needs of products or services either by selling the products or generating employment or for making that product or service available to the society. Sometimes cooperative have members who just work as an investor or support member. There are four kinds of Cooperation in Canada like consumer cooperative, producer cooperative, worker cooperative and multi-stakeholder. These cooperative are governed democratically with the votes of the members and its operative rules are defined at provincial or territorial or federal level.

Profit generated can be reserved for future use or can be distributed among the members; it is mutually decided at AGM. In Canada, cooperative societies can be formed under “Canada Cooperative Act” (Coop Act), for this applicant needs to file an application to the Corporations Canada. A Canadian Cooperative is required to follow the specific Cooperative Act formed at the provincial or territorial or federal level. All types of Cooperatives are governed under the same law except the Financial Cooperatives which are regulated under separate legislation.

Get in touch with Helpline Group today to take your goals further.

We at Helpline Group ensures that clients do not face any hassles or issues while setting up their businesses or firms in Canada. It has a visible presence in Canada that takes care of the needs and requirements of various businessmen and entrepreneurs.