Starting a business in British Columbia (BC) can be an exciting and rewarding experience. One of the most common business structures in Canada is a corporation, offering numerous benefits such as limited liability, tax advantages, and easier access to funding. If you’re considering incorporating in BC, this guide will walk you through the process and key considerations.
Why Incorporate in British Columbia?
Incorporating a business in BC provides several advantages, including:
- Limited Liability: Owners (shareholders) are not personally responsible for business debts and liabilities.
- Tax Benefits: Corporations may benefit from lower corporate tax rates and income splitting opportunities.
- Credibility: Incorporated businesses often appear more reputable to clients, investors, and financial institutions.
- Perpetual Existence: Unlike sole proprietorships, corporations continue to exist even if ownership changes.
Steps to Register a Corporation in British Columbia
- Choose a Business Name
Before incorporating, you need to select a unique name for your corporation. The name must meet the following criteria:
- Be distinct and not too similar to existing businesses.
- Include a legal ending (e.g., “Ltd.,” “Inc.,” or “Corp.”).
- Avoid restricted or misleading terms.
A Name Reservation Request must be submitted to BC Registries and Online Services, costing $30. You will receive approval or rejection within 1-2 business days.
- Prepare the Incorporation Documents
Once the business name is approved, you need to prepare and file incorporation documents, including:
- Incorporation Application: Includes business details, directors, and share structure.
- Notice of Articles: Defines the corporation’s structure and rules.
- Articles of Incorporation: Governs internal operations and responsibilities.
- File Incorporation Online
corporation registration British Columbi athrough BC Registries and Online Services. You can file your incorporation documents online via the BC Services website. The filing fee is $351.
- Obtain a Business Number (BN)
Once incorporated, your business will receive a Business Number (BN) from the Canada Revenue Agency (CRA). This BN is required for:
- Corporate taxes
- GST/HST registration
- Payroll and other business accounts
- Register for Provincial Licenses and Permits
Depending on your industry, additional provincial or municipal licenses may be required. You can check licensing requirements through the BC BizPal website.
Post-Incorporation Requirements
After registering your corporation, you must fulfill ongoing legal and tax obligations:
- Annual Reports: Corporations must file an annual report with the BC government to maintain active status.
- Corporate Taxes: File an annual T2 Corporation Income Tax Return with the CRA.
- Maintain Corporate Records: Keep records of shareholder meetings, financial statements, and key decisions.
- Update Business Information: Any changes to directors, shareholders, or business address must be reported to BC Registries.
Incorporation Costs and Timeline
- Name Reservation Fee: $30
- Incorporation Filing Fee: $351
- Annual Report Filing Fee: $43
- Processing Time: Usually 1-3 business days if filed online
Final Thoughts
Incorporating a business in British Columbia provides numerous benefits, including legal protection and tax advantages. While the process is straightforward, it’s crucial to follow all steps carefully and comply with ongoing regulatory requirements. If needed, consulting a corporate lawyer or accountant can help ensure a smooth incorporation process.
