Starting a Business in Canada

A practical founder's guide to launching legally & confidently

Welcome to the entrepreneurial journey. The administrative "paper trail" can feel daunting for first-time founders — this guide strips away the complexity and gives you a clear, actionable roadmap to get your venture off the ground and keep it compliant.

🏛️ Business Structure 🔢 CRA Business Number 🧾 GST/HST Rules 🏦 Business Banking ✅ Compliance Checklist

Step 1

Building the foundation: choosing your business structure

Your first and most critical decision. This choice dictates your level of risk, how you pay taxes, and your long-term administrative obligations.

Category	Sole Proprietorship	Corporation
Legal Identity	Not a separate legal entity — you and the business are one.	A separate legal entity that can own assets and sign contracts.
Liability	Unlimited — you're personally responsible for all business debts and lawsuits.	Limited — personal assets are generally protected from business liabilities.
Registration Ease	Simple and inexpensive; must be renewed every 5 years.	More complex and costly; higher legal and setup fees.
Tax Treatment	Business income reported on your personal tax return.	Separate corporate tax filings required.

The "Small Business Tax Advantage"

As a sole proprietor, your business income is taxed at your personal marginal tax rate — up to ~50% depending on province and bracket. Corporations often qualify for the small business tax rate (roughly 11–15%).

So what? Incorporating lets you leave money in the company to be taxed at a lower rate — more capital to reinvest and grow, instead of losing it to personal income tax right away.

The "where to incorporate" dilemma

Federal (CBCA): Name protection across the entire country — you can operate under that name in every province, and it's shielded from competitors elsewhere in Canada. • Provincial: Best if you'll operate strictly within one province — but offers no name protection outside it. A competitor elsewhere could legally use your name if they incorporate federally.

Step 2

Navigating the registration maze: your 9-digit identity

Every business needs a unique identity for tax and regulatory purposes — the Business Number (BN). Think of it as the SIN of your business.

ONLINE-ONLY

The online-only mandate

As of November 3, 2025, the CRA has moved away from phone-based registrations entirely. New Business Numbers and program accounts must now be secured via the CRA's secure online portal.

CRA PortalNo Phone Registration

PROGRAM ACCOUNTS

CRA program accounts

Once you have your BN, add specific program accounts identified by a two-letter code:

RT — GST/HST RP — Payroll RC — Corp. Tax RM — Import-Export

💡 Pro-tip: the July 2026 BRO requirement

Starting July 14, 2026, the Business Registration Online (BRO) system will require a CRA-authenticated login. Once you start, you have only 10 minutes of inactivity before the session times out — and there's no "save" function, so gather all your information before logging in.

A critical shift in Import-Export (RM): as of October 21, 2024, RM account management moved to the CBSA CARM portal. Most resident commercial importers now use CARM for their BN9 — but non-resident importers and resident trusts must still obtain their Business Numbers through the CRA.

Step 3

The $30,000 threshold: understanding the GST/HST small supplier rule

One of the most common founder questions: "When do I have to start charging GST/HST?" Canada uses the Small Supplier rule to simplify life for early-stage ventures.

The rule: You're a "Small Supplier" and don't have to register for GST/HST until your gross revenue exceeds $30,000 over four consecutive calendar quarters.
The exceptions: Taxi and ride-sharing services must register immediately upon starting operations, regardless of revenue.

Founder's registration checklist

✓Revenue crossed $30,000 in the last 12 months Register Now
✓Industry exempt from Small Supplier rule (e.g. ride-sharing) Register Now
✓Want to claim Input Tax Credits (ITCs) Voluntary Registration
✓Under $30,000 and okay paying GST on supplies without a refund No Registration Needed Yet

Consultant's note: ITCs are tax refunds on your business purchases. Registering early lets you recover the 5%–15% tax paid on startup equipment and rent — even before your first sale.

Step 4

Treasury setup: business banking & documentation

Separating personal and business finances isn't just best practice — it's a legal necessity to maintain the "corporate veil."

Articles of Incorporation

Or Trade Name Registration.

List of Directors

The most recent version.

Power to Bind Records

Who's authorized to sign and move money — found in your Corporate Minute Book.

Registers & Bylaws

Internal corporate governance documents.

Government Photo ID

For all signing officers.

🏦

Traditional vs. digital-first

Traditional banks require all signers in person; digital platforms are fast but offer less complex-structure support.

Step 5

"What nobody tells you": the post-launch compliance checklist

Launching is just the beginning. To keep your limited liability protection active, treat your corporation as a distinct entity through diligent record-keeping.

The corporate minute book

Even as the only shareholder, you're legally required to maintain a Minute Book — the official record of major company decisions. Banks require its "power to bind" records to open and manage accounts. Failing to maintain this can allow creditors to "pierce the corporate veil," making you personally liable for business debts.

ANNUAL

Annual Information Return

Must be filed within 60 days of your incorporation anniversary to confirm your business is still active.

NON-NEGOTIABLE

ISC Register

Individuals with Significant Control — a transparency requirement. Maintain a register of who truly owns and influences the company to prevent money laundering and ensure accountability.

CHEAT CODE

BizPaL Search

Your shortcut for local compliance. BizPaL.ca helps you navigate municipal requirements — zoning, health inspections, and local business licenses that vary by city.

🚀 Founder's Action Plan

Ready to start? Here's your first move

Take it one step at a time — solid administration today prevents expensive legal headaches tomorrow.

Select your structure

Weigh the liability protection of a corporation against the 5-year renewal requirement of a sole proprietorship.
Get your BN online

Log into the CRA portal to secure your Business Number — remember the November 2025 online-only mandate.
Run a BizPaL report

Visit BizPaL.ca to see exactly which municipal permits you need for your specific industry and location.

Your first 30-day action list

Research business structure (sole prop vs corp) — consult an accountant if unsure
Confirm your immigration/work status allows business ownership
Run a NUANS name search and register your business name
Apply for your CRA Business Number online
Decide on GST/HST registration based on the $30,000 rule
Gather your documents and open a dedicated business bank account
Set up your Corporate Minute Book and ISC Register
Run a BizPaL search for municipal permits and licenses