Incorporating in Canada — Federal vs provincial
How to incorporate, federal vs provincial choice, ongoing compliance
Incorporating in Canada gives your business limited liability, perpetual existence, easier capital raising and tax advantages. The decision is federal (Canada Business Corporations Act, CBCA) vs provincial (Ontario, Quebec, BC, etc.). Each has different costs, name protection scope, and ongoing compliance. This guide compares the options and walks through the steps.
Federal vs provincial incorporation
Federal (CBCA): Name protection across all Canada, easier inter-provincial expansion, slightly more expensive ($200 federal + extra-provincial registrations $50-300 per province). Provincial: cheaper ($300-360 typical), name protection only in that province, simpler for purely local business. Quebec corporation (LSAQ) has French language requirements built in.
Step-by-step incorporation
1) Choose name (NUANS report $20 for federal, $5-30 for provincial). 2) File articles of incorporation with chosen jurisdiction. 3) Pay filing fee. 4) Receive certificate of incorporation. 5) Hold organisational meeting (directors, officers, share issuance, by-laws). 6) Register for BN (CRA), GST/HST if over $30k. 7) Provincial registrations as needed.
Federal incorporation specifics
Filed with Corporations Canada (online via Corporations Canada portal, $200 standard / $250 expedited 4 hours). Articles can be standard or custom. Annual return required ($20). Federal corp must register extra-provincially in any province where it carries on business ($50-300 per province).
Quebec incorporation (LSAQ)
Quebec uses Loi sur les sociétés par actions du Québec (LSAQ). Filing with Registraire des entreprises du Québec. Cost: $327. Must operate in French (or comply with Bill 96 bilingual requirements). Annual filing (Déclaration annuelle) with REQ: $98.
Ongoing compliance
Annual filings with incorporation jurisdiction, annual T2 corporate income tax return with CRA (even if zero revenue), GST/HST returns (if registered), provincial payroll filings, T4 slips for employees, T4A for contractors, ROE for terminations. Failure to file annual returns can lead to dissolution.
How 4b2b helps
Frequently asked questions
Federal or provincial — which is better?
Federal if you'll operate in multiple provinces or want pan-Canadian name protection. Provincial if you're purely local and want lower cost. Quebec businesses often choose provincial due to Quebec-specific rules.
How much does it cost to incorporate?
Federal CBCA: ~$220 (filing + NUANS). Ontario: ~$360. Quebec: ~$327. BC: ~$350. Plus annual returns ($20-100/year) and corporate accountant fees ($500-2000/year).
What's a NUANS report?
Name search ensuring your proposed name doesn't conflict with existing businesses, trademarks. Required for federal incorporation. Provincial requirements vary.
Do I need a lawyer to incorporate?
Not legally required. Self-incorporation online is straightforward via Corporations Canada or provincial portals. Lawyer recommended if complex share structure, multiple founders, or specific provisions needed in articles.
Can I incorporate later as a sole proprietor?
Yes — most sole props incorporate when revenue justifies tax advantages and liability protection (typically $50k+ profit). Conversion involves asset transfer and may have tax implications — consult an accountant.
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