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Entity & System Setup Glossary

Key terms your bookkeeper or accountant may use when setting up your business entity and accounting system.

Sole Proprietorship

The simplest business structure — one owner, no legal separation between the owner and the business. Business income is reported on your personal tax return, and you're personally responsible for the business's debts.


Corporation

A legal entity separate from its owners. A corporation can own property, sign contracts, and be taxed independently from the people who run or own it. Shareholders own the corporation; the corporation itself is the legal actor.


Partnership

A business structure where two or more people share ownership. Partners share profits, losses, and — unless you've set up a limited partnership — personal liability for the business's debts.


Shareholder

A person or entity that owns shares in a corporation. Shareholders own the business but aren't automatically the ones who run it day-to-day — that's the role of directors and officers.


Articles of Incorporation

The legal document that officially creates a corporation. It sets out the corporation's name, share structure, and any restrictions. Filed with the provincial or federal government when you incorporate.


Business Number (BN)

A 9-digit number assigned by the CRA to identify your business. All your CRA accounts — GST/HST, payroll, corporate income tax — attach to this number. Think of it as your business's version of a SIN.


CRA MyBusiness Account

The CRA's online portal for business owners. Through it you can view your tax balances, make payments, file returns, check your GST/HST account, manage payroll, and communicate with the CRA directly. You set it up at canada.ca using your BN.


Fiscal Year-End

The date your business's accounting year closes. Sole proprietors must use December 31. Corporations can choose any month-end date. Your year-end determines when your tax return is due and how your annual books are structured.


Provincial Registry

The government office in each province that handles business name registrations and incorporations. Each province has its own (e.g., BC Registry Services, ServiceOntario, Alberta Corporate Registry).