Running a business is one of the best ways to gain financial freedom. However, it’s easier said than done. Before establishing a successful business, you need to comply with a lot of rules and regulations. First and foremost, registering is crucial if you’re looking to start a business.
Registering a business is necessary for regulation and tax purposes. This process tends to differ from state to state. Suppose you live in Ontario, Canada. This article will ease the journey for you by discussing what you should know regarding business registration:
-
Choose A Business Name
Upon business registration Ontario, you must already have a business name in mind. After all, it’s important for local authorities and the general public to identify your business by name. Another thing is, you must choose a unique business name. The government requires that your chosen name shouldn’t be in use by another business or enterprise.
To make sure you choose a unique business name, you can perform a search online using search engines or a reliable database. In Ontario, you can use the Ontario business name search platform. It’ll identify any other company using the same name. You can also rely on the Newly Upgraded Automated Name Search (NUANS) database. Using this database, you can find business names that are already using the name you have in mind.
Aside from choosing a unique business name, there are other rules you must observe. For example, it shouldn’t be offensive or have words affiliated with the government. Once you settle on a business name, you must fill up a Doing Business As (DBA) form.
-
Business Structure
Your business structure will also have legal implications, so you will be required to signify this upon registration. The most common business structures in Canada are sole proprietorships, general partnerships, and corporations.
Generally, the Canadian government will identify your business as a sole proprietorship if you’re the sole owner. Partnerships, on the other hand, are usually composed of two or more persons. In Ontario, corporations can be created by just one person but other jurisdictions require a number of directors.
You must carefully choose the structure of your business. This is because each structure will have varying implications when it comes to liability. For example, if the business incurs debts and has defaulted on its obligations, the payment of liabilities will differ depending on the business structure.
In a sole proprietorship, for example, the assets of the proprietorship and the business owner could be used to pay the remaining obligations. But creditors of corporations cannot touch the assets of an incorporator, they can only exhaust the assets of the corporation.
-
Taxes
This is another reason why you should choose your business structure carefully. The rate of business tax you’ll pay would be dependent on the structure you choose to register your business as.
For corporations, federal tax rates start at 9% while Ontario’s provincial tax rate would range from 3.2 to 11.5%. Sole proprietors would have to file individual tax returns with federal tax rates ranging from 15 to 33%, along with Ontario’s provincial tax rate of 5.05 to 13.16%
-
Business Address
To register your business in Ontario, you must be actually doing business in Ontario. Canada is comprised of many territories and provinces, and you must register your business in every province where you choose to operate.
Suppose you were first doing business in Ontario. Then over time, your business expands to Alberta and Quebec. You must register your business in these provinces using your initial registration details. Failure to do so will result in fines and penalties.
-
Required Licenses and Certifications
You might also be required to comply with certain licenses and certifications, depending on the kind of business you’re establishing. For example, if you are in the food business, you would need a sanitation permit and other requirements set by Ontario’s Food Premises Regulation 493/17 or the Canadian Food Inspection Agency.
If your business has to store or transport waste, you would also need to comply with environmental regulations. This requires another set of permits and licenses for environmental compliance. Aside from all these, you might also need to secure municipal licenses.
Conclusion
Many entrepreneurs will tell you that running a business is not a walk in the park. Well, the challenge really starts the moment you choose to create and register your business. There are a lot of legal requirements you need to hurdle. Not to mention, you’ll be spending a significant amount of time and money to successfully register your business. With the information listed above, you now know what to expect and what to prepare beforehand to hasten the registration process.
