How to Start a Business in Canada

Starting a business in Canada means registering with the right authorities, opening a business bank account, and getting your financial records set up from day one. This guide covers the legal and financial setup steps, it does not cover business planning, licensing, or industry-specific permits.

What You'll Need

Your SIN (Social Insurance Number)
A business address
A decision on your business structure (sole proprietorship, partnership, or corporation)

Normal Procedure

Step 1: Choose your business structure

The three main options:

Structure	Best for	Key trade-off
Sole proprietorship	Freelancers, single-owner service businesses	Simple and cheap to set up, but you're personally liable for business debts
Partnership	Two or more owners	Easy to set up, but each partner shares personal liability
Corporation	Businesses wanting liability protection or planning to grow	More tax planning options, but more paperwork and cost to set up

Step 2: Register your business

Sole proprietorship or partnership:

Register your business name with your provincial registry (required in most provinces if you're not operating under your legal name)
Cost is typically $60-$150 depending on the province

Corporation:

Incorporate provincially (through your province's registry) or federally (through Corporations Canada)
Federal incorporation costs $200 online; provincial fees vary ($275-$450)
You'll receive a Certificate of Incorporation and Articles of Incorporation
Most provinces require a NUANS name search first to confirm your name is available

Step 3: Get your CRA Business Number

Once registered, apply for a Business Number (BN) with the Canada Revenue Agency (CRA). Your BN is a 9-digit number that identifies your business for all tax accounts.

At the same time, register for the accounts you need:

GST/HST: Required once your revenue exceeds $30,000 in any 12-month period. You can register voluntarily before that.
Payroll: Required if you're paying employees or paying yourself a salary (corporations)
Corporate income tax: Required if you incorporated

Apply at canada.ca or call CRA's Business Enquiries line at 1-800-959-5525.

Step 4: Open a business bank account

Open a dedicated bank account for your business before any money moves. Mixing personal and business finances is the most common bookkeeping problem, it creates a significant cleanup cost later.

Most major Canadian banks offer business chequing accounts. Bring your registration documents and BN when you apply.

Abnormal Procedures

You want to incorporate but aren't sure whether to go provincial or federal.

Federal incorporation protects your name across Canada but also requires you to register extra-provincially in each province where you operate. If you only operate in one province, provincial incorporation is simpler and cheaper. Ask your Mesa CPA advisor before deciding.

You're converting from sole proprietorship to corporation.

The corporation is a new legal entity, it needs a new BN, a new bank account, and a new QBO file. Your Mesa CPA team will manage the transition, but give them at least two to three weeks of lead time.

You're a non-resident starting a Canadian business.

Different rules apply for non-residents around incorporation, GST/HST registration, and filing obligations. Flag this to your Mesa CPA advisor before you register anything.

FAQ

Do I need a lawyer to incorporate?

Not necessarily. Many business owners incorporate online directly through their province's registry or through services like Ownr or Lex Start. A lawyer is worth it if you have multiple shareholders, need a shareholders' agreement, or have a complex ownership structure.

When do I have to register for GST/HST?

Once your total revenue exceeds $30,000 in a single calendar quarter, or over the last four consecutive quarters, you must register. You can register voluntarily before that threshold, sometimes useful if you want to claim input tax credits on early expenses.

What is a fiscal year-end?

It's the date your business's accounting year closes. Sole proprietors must use December 31. Corporations can choose any month-end date. Your Mesa CPA advisor will recommend the best option for your situation.

What's a NUANS search?

A NUANS (Newly Upgraded Automated Name Search) checks that no existing business has a name too similar to yours. It's required before incorporating federally or in most provinces. You can order one at nuans.com.

Can I use my home address as my business address?

Yes, for most structures. Corporations must have a registered address in the province of incorporation, and it must be a physical address (not a P.O. box). A home address is acceptable.