Business Registration

Incorporating Your Business in Canada


When you decide to operate a business, the first question to be addressed is what legal form the business will take. There are three typical ways in which you may carry on a business: as a sole proprietorship, a partnership, or a corporation. Now Creative Group recommends this simple online service to guide you though the process.

A corporation (also called “company”) is a legal entity that has its own legal personality which is distinct from its owners (called shareholders) and the individuals who manage and run its affairs and business (called directors and officers). The creation of a corporation occurs following the proper filing of Articles of Incorporation (also called a Charter or Certificate of Incorporation) with the relevant government department or authority.

Every corporation is comprised of shareholders, directors and officers. Shareholders, as the name implies, are the ones who hold (i.e., own) the shares in the corporation. By reason of the votes that are usually attached to the shares, the shareholders control the corporation. If there is only one shareholder, that person has absolute control of the corporation. If the corporation has numerous shareholders, control of the corporation depends on who has a majority of the voting shares. However, the shareholders do not directly manage the corporation. They exercise their influence by electing and removing directors and approving or disapproving major corporate decisions.

One of the responsibilities of the shareholders is to elect the directors of the corporation, usually on an annual basis. Directors need not be shareholders of the corporation. The directors are responsible for supervising and administering the corporation’s affairs, and appointing the officers, who are in turn responsible for the day to day running of the corporation.

Learn more or start the incorporation process online right here.

Get Started with Incorporation

Advantages of Incorporating a Business

There are several features that are unique to a corporation which make it the favoured legal structure for many businesses. These include:

  1. Limited Liability | A primary advantage to incorporating a business is the limited liability conferred upon its shareholders. The shareholders are not liable, in most cases, for the debts and other obligations of the corporation. A shareholder’s liability for the debts of the corporation is limited to the amount of funds such shareholder has invested in the corporation. Creditors only have rights against the corporation itself and not against the shareholders.
  2. Perpetual Existence | A corporation has the feature of perpetual existence. It is not dependent upon the life of its shareholders, directors and officers and will not be affected by changes in, deaths or retirements of its members since the corporation is considered a separate “person”. This advantage allows for the orderly transfer of ownership of the corporation (i.e., its shares). Furthermore, due to its independent legal status, it may own property in its own right, enter into contracts and sue (or be sued).
  3. Capital Acquisition | A corporation may offer greater potential sources of capital than other business forms (such as sole proprietorships and partnerships). Corporations can issue various classes of shares (in addition to other debt instruments such as bonds) to raise capital, which, typically, is more attractive to investors.
  4. Tax Advantages | There are tax advantages to incorporating your business, such as lower income tax rates and carrying forward losses of previous years to offset profits in subsequent years, among others.
  5. Credibility and Prestige | Incorporation may help provide your business with credibility and prestige in its business dealings.

To learn more and start the incorporation process, click here.