This article is for informational purposes only and does not constitute legal, accounting, or tax advice. The information contained herein is subject to change and may vary from time to time in your region. For specific advice applicable to your business, please contact a professional.
Every year, thousands of new businesses enter the marketplace in Canada, with the vast majority opening in Ontario. In fact, more than one-third of all Canada’s small and medium-sized businesses are located in Ontario.
However, during the last few years, as COVID-19 seemingly put a stopper on business growth and creation, you may feel like starting up a new venture is something to put on hold. However, this is not the case, with the market still crying out for new and exciting companies. If you are interested in starting your own small business, there are a couple of key steps to take to ensure current and future success.
Regardless of the industry you’re in, or whether you’re creating a sole proprietorship or partnership, this step-by-step guide will set you on your start-up journey. From where to begin, to choosing a name, read on to learn more about mastering the art of the start-up.
The Benefits of Starting a Small Business in Ontario
Canada is a great place to grow and start your business. However, Ontario is a particular hotspot, it seems, as it’s home to some of the nation’s highest personal incomes.
It also has the largest economy of all the provinces and territories. So, not only will you have access to a great potential local market, but you’ll also benefit from a simple registration process, immense support in the form of related services, and favourable tax rates.
Get Started With Square Invoices
Get paid faster with online invoices.
Where to Start: Getting Your Small Business Off the Ground
Before you think about registering your small business, you will first need to decide whether you’d like to operate as a sole proprietorship, partner, or corporation. Then, you’ll have to choose a name — which will need to be registered if you use any title other than your own legal name. Failing to do so can result in a significant fine, as stated under the Ontario Business Names Act.
Creating and Registering Your Business Name
It’s not all rules and regulations, though - this is the fun part. Get creative and do your research. You need to make sure your business name is unique, yet not too vague and also immediately displays your brand aesthetic. You can find out more on how to create the perfect name for your business here.
However, it’s important to understand what you can and can’t call your business regarding potential legal ramifications. For example, you cannot name your business anything that’s associated with any branch of government in Ontario. You can find out more information on how to register your business name here.
This process will apply to any entrepreneur who would like to register a sole proprietorship, a partnership, or a corporation. Following the creation of your chosen name, you’ll need to undertake the business registration process.
To do so, head to ServiceOntario, where you will find all the information you need to register a small business. Once you’ve dotted the ‘I’s and crossed the ‘t’s, you’ll be registered for five years. After that period, you’ll have to repeat the process again to renew your business.
Please note: It is your responsibility to ensure that your business is up to date. However, if you are slightly late when it comes to renewal, it’s typically possible to renew your registration within 60 days after it has expired.
How Much Does Registration cost?
Depending on the name search you conduct, this step will cost you between $8 and $26, followed by a $60 fee to register your business name (the same cost applies when you renew).
If, at any point, you are unsure whether your business name is already in use, or would simply like to ensure due diligence, a public record search is recommended.
What Exactly is a Name Search?
The idea behind a name search is to ensure that you do not register a business name that is already in use or, in many cases, trademarked.
Although there are legal steps you can take, registering your business name does not guarantee protection regarding exclusivity. In this case, a trademark is required.
When you do conduct your name search, it is also beneficial to obtain a Nuans report. This will provide you with a list of all corporate names and trademarks across Canada (excluding Quebec) that are similar to your intended name. It is valid for a total of 90 days, so it gives you plenty of time to decide and register your company title.
The Registration Process
Once you are confident in your name you can proceed with the business registration process. To begin, you’ll need your name and the address of your company. You will also need to be able to provide a description of what your business intends to do in relation to its activity – what products will you be selling? What services will you be providing?
Your name and home address will also be required and, if you are registering a partnership with ten or fewer partners, you will also need to provide each partner’s full name and address.
At the end of the business registration process, you will receive your Master Business Licence (MBL). This will act as proof that your business is registered if you ever need to seek assistance from a financial institution.
Be Mindful of Licences or Certificates
Depending on the type of small business you plan to operate, you may be required to seek other associated licences, certifications, or registrations.
For example, you may need an environmental or a zoning permit, or a municipal business licence. The key is understanding what will be required of your business based on provincial and federal laws. Once again, an example would be knowing when you need to register a GST/HST number or whether you need to register for Workers’ Compensation Insurance.
How to Register Your Small Business as a Corporation
It’s important to note that a corporation is unique in comparison to a sole proprietorship or partnership. One of the most distinct differences is based on the fact that corporations act as separate legal entities — which is particularly beneficial in terms of liability. Corporations also benefit from certain income tax advantages.
If you would like to register as a corporation, you will need to:
- Incorporate your business, which will require you to obtain articles of incorporation.
- Obtain a federal business number, as well as a corporation income tax account through the CRA.
- Register as an extra-provincial and/or extra-territorial corporation if you plan to do business in other Canadian jurisdictions.
- Apply for any specific business and tax permits or licences that are required for you to operate.
You can find out more on the Government of Canada site.
Creating a Successful Marketing and Business Plan
Congratulations, the ‘hard’ part is over! You’ve successfully registered your small business and are ready to start tackling trade. However, you’ll want to start to research and learn some key strategies in relation to your specific business model, to help your small business operate and grow successfully.
Some of these areas include legal requirements, how to manage cash flow, a marketing strategy, and payment processing.
To ensure that all your ducks are in row, you’ll want to create a solid business plan and take action accordingly. This guide will help you create a business plan that will allow you to concentrate on what matters most in terms of success and growth. It’s also important to make sure that your strategy is personal to your small business – there is no ‘one size fits all’ approach to marketing. Although, we’d love it if that were the case.
Products and Software to Help You Get started
It’s important to know that you’re not on your own when starting up your small business - even in an age of COVID-19 pandemics, lockdowns, and general business uncertainty. Especially in today’s world when amazing tech and software can make the processes of trade and management as natural as brushing your teeth in the morning.
Square has been helping millions of sellers run their businesses, learn new tactics, and has changed how companies conduct their business in Ontario and Canada as a whole.
Whether you’re onsite or on the go, Square hardware allows you to take payments anywhere and everywhere. Starting up and taking your business online doesn’t have to be a huge leap. The Square Point of Sale (POS) software allows you to manage key aspects of your small business in one place, while you continue to grow your company and overall brand.
Some of the main benefits of Square include:
- Gaining access to your money quickly with our Business Mastercard.
- Access and manage payments all in one place.
- Obtaining real-time data that will help drive key business decisions.
- High security based on multiple layers of encryption.
If you’re ready to take your idea to the next step, it’s time to register your small business and work towards your evolving goals.
For more information on key growth strategies, be sure to check out these resources.