So, you?re thinking about starting a business in British Columbia? Awesome! Being a business owner can be an incredible experience, full of challenges AND incredible opportunities. I?ve been an entrepreneur for over 10 years and it?s been an incredible journey. The first step for most entrepreneurs is to register their business.
What does it mean to register a business in British Columbia?
Generally speaking, registering a business can mean a few different things:
- Securing your business name so you can perform services/sales & earn income using that business name
- Protect your business name from other people using it
- Register your business operations with the provincial business registrar
- Depending on your province, you may also have the opportunity to register for federal & provincial tax programs while registering your business
PART 1: Determine your business type
We have 3 main legal business structures in Canada, with different legal and tax implications within each type. It may be a good idea to consult with a lawyer and an accountant if you?re unsure which option would be the best for you. Here?s a summary below, with some key points to consider
1. Sole Proprietorship
A Sole Proprietorship, (also often called being ?self employed? or a ?contractor?), is an unincorporated business that provides sales/services to others. You can operate this business type either under your own name (i.e. Jennifer Long) or a registered business name (The Corporate Canuck Management Services).
Because a Sole Proprietorship is essentially an extension of you as a human, all business operations are tied to YOU. This means your income/expenses is included as part of your personal tax return each year (there?s a special tax form for this) AND you are responsible for any legal risks in your business. It?s easy to set up a sole proprietorship which is why many new business owners start with this business type when they decide to register their business in British Columbia.
A partnership can be two OR MORE individuals who decide to go into business together. It?s often set up similarly to a sole proprietorship, but depending on your province it may require special paperwork. (See specific links to each province below)
A corporation in British Columbia is viewed as a separate, legal entity. This means it is treated as if the company was a unique individual- it has a unique name and unique tax numbers. It requires its own special type of tax return each year, and may protect its individual owners from certain legal actions (Note the word ?may?- it depends on the type of legal claim and who is making it).
If you’re wondering if you should incorporate, I put together this guide on the topic. Setting up a corporation requires legal documentation (generally, creating ?articles? which discuss how the corporation will be run), and may require annual provincial filings which confirm company details. It is the most costly, and professional advice is recommended before registering this type of company.
PART TWO: Register a Business in British Columbia
STEP 1: Conduct a name search in your province/territory. This can usually be done online through the regional department responsible for business (See links below).
Tips to make the most out of your Business Name Search
*Use descriptive words when you can, i.e. Jennifer Long Management Services
*List multiple varieties/names for a better chance of approval (most Name Searches will let you choose up to 3)
*Typical cost ranges from $10-$75, depending on your region
If you are registering as a corporation, you will need to do a name search and supply Articles of Incorporation. Typical registration cost (not including legal consultations) starts around $300, depending on your region.
STEP 2: Register for tax numbers. Depending on your business setup, you may require federal tax numbers (GST/HST), Payroll Accounts (if you have employees), Corporate Tax Accounts (if you?re registering as a corporation), or Provincial Sales Taxes (PST/QST). If you?re unsure of what you may need, check with a local accountant for the best advice.
The process to register a business in British Columbia can actually be quick and inexpensive, depending on how complex your company needs are.
Here’s a summary of key links & information to help you register your business in British Columbia. Good luck!
STEP 1: Name Search
Time: 10-15 Days
STEP 2: Register Your Business in British Columbia
Time: 2 days (sole proprietorship) to several weeks (corporation)
Cost: $40+ (Sole Proprietorships + Partnerships); $350+ (Corporations)
STEP 3: Tax Numbers
(May be mandatory; check with a local accountant to confirm if it applies to your business)
Provincial Sales Tax (PST) (If you are required to collect/remit PST)
Federal Sales Tax (GST/HST) (if you are required to collect/remit GST or HST)
Federal Payroll Account (if you have employees)
Federal Corporate Income Tax (for corporations)
If you’re looking for a one-stop setup, check out Ownr. They provide a complete registration service for new businesses (sole proprietorships AND corporations) and you can do everything listed above with one account. It?s awesome, and makes registering a business in British Columbia a breeze.