A corporation, which is also called a company, is a legal entity, separate from its owners. The shareholders (owners) of the corporation or the directors (individuals who run the affairs of the corporation) are not liable for the debts of the corporation unless such individuals personally guaranteed those debts.
Provincial or Federal Incorporation?
A federal incorporation allows you to operate your business under the registered business name across Canada. (extra-provincial licenses are needed to carry on business in different provinces)
A provincial incorporation only allows you to operate your business in the province you incorporate in. The registered name is only exclusive to you in that province.
To determine how which level of incorporation best suits your company, you need to determine if you plan on expanding your business into different provinces in the future. If you plan on opening a business that only operates out of Ontario, you would want to incorporate provincially. If you plan on opening your business in different locations across Canada, then you would want to incorporate federally.
Once you incorporate, you will need to organize your Corporation and that is done in a Minute Book.
A minute book is a binder that organizes and keeps all important corporate documents such as; articles of incorporations share certificates, shareholder/director minutes and resolutions, tax filings, annual filings, corporation bylaws, etc.
If you do not maintain your corporation minute book, your company may be forced to dissolve for non-compliance with the laws. Setting up your minute book and maintaining it as you go along will save you money and inconvenience in the future.
Rules and regulations of a corporation can be found in the Business Corporations Act
Here is a checklist – when deciding to incorporate
- Choose your Legal Structure
- Choose a Corporation as your legal structure (as oppose to a business registration)
- Choose your legal structure: Provincial Corporation or Federal Corporation
- Choose a Business Name or Registered Number Company
- Complete the registration process of Articles of Incorporation
- Register your business name with Service Ontario if you require a Trade Name
- Prepare other documents – Initial Notice and organizational material
ACLS will help you organize and structure your company. Once incorporated, ACLS will handle maintaining your corporation annually and assist you in keeping your company affairs in order.
ACLS offers you services you can afford, call us first and we help you through the process.