If you are a small business owner, sole proprietor, or are contemplating starting up a business, you have likely considered incorporating.
1) Decide if you would like to incorporate a Federal or Ontario Company
Do you plan on operating solely in Ontario, or across the country?
2) Provide us with key pieces of information
You will need to name your company. We will do a name search to make sure that someone else hasn’t registered that company name. If you don’t want to come up with a name that no-one else has used before, then in Ontario, you can be assigned a number for your company.
Here are some examples of names of numbered companies: Ontario 100001 Ltd., Ontario 100001 Limited, Ontario 100001 Inc., Ontario 100001 Corp.
Give us with the name and address of first director. After the articles of incorporation are registered, other directors and officers can be added. Once we have this information we can prepare the articles of incorporation and you need to sign them. We will need two original signed copies of the signing page for incorporation.
Directors are the individuals who make the major administrative decisions of the corporation. Ontario law requires that the majority of the directors be canadian residents. At least one director must be a Canadian resident if you only have two directors. Directors may also be shareholders as well as officers.
This is a great time to trademark the name of your company. Protecting this name may be vital to your business.
3) Meet with an accountant
At some point you will want to meet with your accountant to discuss financial matters. You may want to ask about the year end date, or how shares should be held to best maximize tax savings. This needs to be done before the company is organized, so it is best to get this meeting done early.
4) Documents are sent to the registry office
Once we have the signed articles of incorporation we send them to the registry office and our conveyancer will register and send them back to us. When we get the registered articles back, we order the corporate minute book and seal, and prepare the organizational by-laws, resolutions, share certificates, etc.
5) Give us even more information
To prepare these documents, we need the following information:
• Address of registered head office
• Name and address of shareholders and list of what shares they will be buying
• Name and address of accountant
• Information for the President and secretary of corporation
• Year end date
6) Sign the corporate documents and discuss legal implications
Once we have prepared the minute book, we will set up a meeting to sign the corporate documents (by laws, resolutions, share certificates) and discuss the legal implications and obligations of operating your company.
7) Obtain other permits and Licences
After you have set up your corporation and are maintaining it according to the legal requirements, you must turn your attention to other legal requirements such as the following:
• Register for a federal Business Number. The Business Number is used by the federal government to identify businesses for a variety of accounts:
• federal corporate income taxes
• import/export account
• GST/HST collection
• employer payroll source deductions
• Register any non-corporate business names (business names other than the exact registered corporate name) used by the corporation in the province in which the business operates. This is a provincial legal requirement.
• Register for a provincial sales tax account (if applicable)
• Register for provincial Employer Health Tax, & Worker’s Compensation
• Obtain any Provincial and/or municipal licenses
8) Set up a bank account
In order to set up a corporate bank account, you will need to supply the bank with a copy of your articles of incorporation and any articles of amendment. All authorized signing officers of the corporation must sign on to the account at the bank before they are permitted to sign cheques or access the corporate account. The bank may also require certain corporate by-laws or other resolutions to be passed before opening the account.
The whole process can be completed very quickly and can provide much protection in terms of providing yourself with limited liability along with providing major tax savings.
Before proceeding, please note:
If you are not a current client of Cheadles LLP, please do not include any information in this email that you or someone else considers to be confidential or secret in nature. Prior to the establishment of a lawyer-client relationship, unsolicited emails from non-clients containing confidential or secret information cannot be protected from disclosure.