The Step-by-Step Guide to Starting a Business in Ontario
If you're an aspiring entrepreneur in Ontario and want to take the plunge into business ownership, we've got you covered.
Do you long to put your business savvy to use and become your own boss? We're here to help you take the plunge if you're an aspiring entrepreneur in Ontario.
For starters, let's make sure you know exactly what you're getting into. Successful business owners must often work long hours, overcome challenging learning curves, and perform a dizzying array of tasks. You'll have to make more of an effort to keep your finances in order, and you can expect more competition. That's why it's crucial to think things through thoroughly and gather data before introducing a brand-new venture to the market.
When establishing a company in Ontario, there are a number of mandatory procedures that must be completed. We're also here to lend a hand. To assist you in launching your own business, we have compiled this comprehensive how-to guide, loaded with useful data and references.
How to Get Your Ontario Company Off the Ground
Several legal considerations must be made before a business can begin operations.
Establishing a legal presence for your company through registration
It's up to you to figure out what your business structureorganizational framework When deciding between the three main alternatives registering your business in Ontariobusiness setup in Ontario :
- Private ownership (or, "sole proprietorship") You alone hold legal title to and are personally liable for all property and debts.
- Corporation — Incorporating a businessEstablishing a company's legal existence through incorporation establishes a new legal entity, which is separate from you and your personal assets and liabilities. To put it simply, it's the most convoluted form of corporate organization.
- Partnership You and your partner(s) have full legal and financial control over the company and its operations.
In terms of legal requirements, establishing a business takes on a variety of shapes and sizes.
Obviously, if you're a sole proprietorbusiness entity consisting of a single individual or entity If you are doing business under your own name, you do not have to file any paperwork with the government. However, you must register your business with the province if you want to use a different business name, or if your business is a partnership or corporation. When a company is registered in Ontario, it is also registered at the federal level.
Incorporating a business requires filing paperwork with the provincial governments of Ontario and any other jurisdictions in which you intend to conduct business. Your company's name will only be protected in the states where you file for incorporation, but a federal filing will give you protection and recognition in every state and the rest of the world.
When you incorporate, no other company can legally use your company's name in any of their own operations. However, the legal protection is jurisdictional, so if you only incorporate in Ontario, your business name will not be protected in other jurisdictions. When you incorporate at the federal level, your company name is safeguarded across the country, regardless of whether or not you have separate provincial or territorial incorporations.
Though many business owners will seek the counsel of an attorney when incorporating, you can save a lot of money and time by using Ownr.
Methods of Obtaining a GST/HST Number
In addition, you'll have to make a choice between apply for a GST/HST numberfill out a GST/HST application The majority of sole proprietorships, partnerships, and C corporations with annual sales of less than $30,000 are exempt from collecting GST/HST according to the CRA. If your quarterly or annual global sales are more than $30,000, you must obtain a GST/HST number and start collecting sales tax on all products and services sold.
Registering to collect GST/HST voluntarily before reaching the $30,000 revenue threshold can be financially beneficial. There are two ways to report GST/HST (a "quick" way and a "long" way), and the amount you end up paying in taxes depends on which one you choose. file your GST/HST returnssubmit your HST/GST forms
Obtaining Necessary Authorizations
To legally conduct business, you might need to obtain certain licenses or permits. You can easily and quickly obtain a comprehensive inventory of all the licenses and permits your business type may require by using BizPal , a platform that is managed in tandem by national, state, and local authorities online
Now that we've gone over the fundamentals of starting a small business in Ontario, we can move on to our 12-step checklist for getting your company off the ground.
What You Need to Know Before Opening an Ontario Business
1. Think of a marketable product or service.
You might be here because you've got a great business idea and could use some help turning it into a reality. But if you want to start your own business but are having trouble deciding what to do, we have some ideas to help you get started.
Entrepreneurs often come up with the best business ideas when they are attempting to address a need in the market. Apps, for instance, can aid in habit tracking, business transactions, food delivery, and much more. Homeowners can get their lives in order with the assistance of maid services, junk haulers, and professional organizers. Consultants help businesses and governments with their internal problems.
The issue may even be manageable in scope. At the time that Tina Nguyen, the company's creator, XXL & CO for a cousin with extremely long hair, and the experience inspired her to start a business catering to women with similar needs. In the first year, she went from making XXL scrunchies in her parents' basement to employing 15 people and relocating her business to a warehouse.
Have you developed a talent of your own that could be used to make money? As an alternative, do you think you'd be able to apply your side hustlealternative source of income as a permanent position Possibly you feel strongly about a certain item, or you have a suggestion for how things could be done more effectively.
Think about the kind of job and environment in which you'd be most happy working. An online store is a great option if you're looking to make money without having to interact directly with customers. e-commerce storeInternet Shop Certainly makes more sense than setting up shop in the old-fashioned way
Two, do some market analysis
Conducting market researchinvestigation of the market represents a vital first step in learning about your target market, the interest in your products or services, and the nature of your competitors. It's fundamental to creating a prosperous company.
Consider the following as you conduct your market research:
- Who could be your customers in the future?
- Is there a market for what you're offering?
- Who is your ideal customer, the one who is most likely to buy from you?
- What are customers hoping to find in the service you provide?
- The price at which customers are willing to buy your goods or services
- What is the total cost to produce or acquire your product, plus the cost to transport it to your customers?
- If you wanted to start a business, would there be enough of a market for your product?
- To what extent do you differentiate yourself from the competition?
There is a wealth of market information available on the web. Statistics CanadaCanada Census Bureau offers valuable insights into the composition of the buying public, and the Canadian Industry StatisticsCanada's Industrial Statistics database Businesses Improvement Areas (BIAs) in the area where you plan to open your storefront can be a great resource, and your city or town hall may even have neighborhood demographics data that you can use. Toronto’s is very extensiveExtensive in Toronto. ) Finally, Small Business Enterprise CentresCenters for Micro and Small Businesses Small Business Development Centers (SBECs) are also an excellent option for entrepreneurs in need of guidance, services, and training.
Prospective buyers could also be polled or surveyed. Resources available on the Survey MonkeySurvey Taking With Monkey , Google FormsForms on Google This is facilitated by the widespread availability of polling tools on various social media platforms.
3 Pick a label for your company
Business names are required in order to register or incorporate a company, so it's important to pick one that stands out from the crowd.
Check that your ideas for a company's name aren't already in use by conducting a Google search and a domain name whois lookup. Even if a business is set up as a sole proprietorship or a partnership, the name of the entity itself is not automatically protected by law. two or more businesses to have the same namewhen two or more companies share a name —yet that may induce some consternation amongst the target audience
Next, look up your potential company names on the NUANS databaseRegistrar of the NUANS incorporation and the Canadian trademark databaseOnline searchable database of Canadian trademarks Choose carefully to avoid using a name that is already in use. It's mandatory to have when forming a company in Ontario or the United States. get a NUANS reportprocure a report from NUANS search engine authorized to conduct such operations Saving money on search fees is easy with Ownr, as you can pre-search up to 30 different names at once.
A company can be formed under either an English or a French name. The use of both the English and French versions of a business name necessitates two separate NUANS reports. Include a translation of your company name into any language you'd like.
Limited, Limitée, Incorporated, or Corporation (Ltd) must be added to the end of the name of every business in Ontario that is incorporated. Ltd., Corporation or Corp for short)
Alternately, you could incorporate under a number name (which doesn't necessitate a NUANS search), register a business name with the province, and then trademark it to secure your brand.
4. Establish your company's legal status by incorporating or forming a legal entity of your choosing
We've gone over the three major categories of business structurescorporate frameworks are incorporated, sole proprietorships, and partnerships Considerations such as liability, tax rates, and capital requirements all play a role in establishing the optimal choice for your business.
As a rule, sole proprietorships and partnerships are less complicated business structures that necessitate less paperwork during formation and ongoing reporting. One potential drawback is that business owners are personally liable for any damages their company causes, which could put personal assets like a house or car at risk. In addition, you must pay taxes on your business income using the same method you use to pay taxes on your personal income. Registration with the province is required for all partnerships and sole proprietorships using a name other than the owner's.
Since corporations are treated as separate legal entities, their owners are shielded from personal responsibility for business debts and lawsuits. There is a tax benefit to incorporating your business and taking a salary if it becomes very successful. Finally, businesses can raise capital through a wider variety of channels, including the sale of shares and loans with competitive interest rates.
Ownr streamlines the process of obtaining your articles of incorporation, which is a complicated and time-consuming part of incorporating your business. To make sure you don't miss a thing, we guide you through the steps of registering, gathering paperwork, and filing your incorporation. We also provide a central repository for all of your vital records. Corporate management plans are available, which can help you save both time and money in the long run.
Five, get a website and social media accounts.
Now that you have decided on a company name and structure, you should get a domain name and establish social media accounts.
The best case scenario is that your desired domain name (e.g., g company, you're in as well as any relevant social media handles (such as @yourcomapny) If you want to make sure you can get the domain name you want for your business, you should look into it before registering the name. com or ca, and for a fair price
Don't freak out if your full name can't be found. Think about alternative forms that use punctuation, identifiers, or shortened forms of words (such as an abbreviation, acronym, or place name). For a unified brand image, use the same naming scheme across all online and social media properties.
You can have a little fun and show your personality by coming up with unique names for your website and social media accounts. Design firm Bloom, based in Ontario, went with a classy verb phrase for their domain buildwithbloom.com Twitter: @buildwithbloom; Instagram: @buildwithbloom Wellbe, a Toronto-based wellness clinic, instead chose to prefix its domain name with the word "hello." hellowellbe.com names, and Twitter and Instagram handles (@hello well (as in, you know, very well, or very well) ), reiterating the brand's friendly, approach
Building a website and planning your social media posting strategy can begin after you've registered your domain name and made your social media accounts (which should be kept private or unpublished until your business is ready to be launched). If you want to build a successful website, you need to know your company's unique selling proposition, your audience, and your marketing strategy in broad strokes. The process of creating a website frequently coincides with that of creating a business plan. In order to save money on both website creation and upkeep, a website building serviceService for Creating Websites The services of a copywriter who focuses on content for small business websites and a designer to create a logo and visual branding are worthwhile investments if you have the means.
Even if you only plan on using one or two social media platforms for your business, you should still register your handle on each of these sites to protect your brand: Instagram, Facebook, Twitter, TikTok, YouTube, Pinterest, Snapchat, and LinkedIn.
Formulate a formalized business strategy.
Don't rush into things; take the time to create a thorough business plan. Feeling lost or overwhelmed because of the sheer size of the task at hand? business plan templateexample of a business plan can help
As you craft your business planIn the course of developing your company's strategy, , you'll get a feel for where you stand and where you might want to invest more time or money. When it comes to money, having a well-thought-out business plan is essential. Even if you have money set aside to cover the business's initial expenses, it usually takes companies between one and two years to begin making a profit.
You might believe there's no need to create a formal business plan. This is especially true if you're a successful sole proprietor with a large clientele base and a solid reputation in your field. However, the procedure can prove to be priceless for any company's leader. It can aid in the discovery of untapped markets or niches, the establishment of measurable growth objectives, and the discovery of value-sharing partnerships with customers.
Remember that nothing in your business plan is written in stone. Aim for a solid plan, not a perfect one, as your vision will change as your business and the market develop.
Seven, create a company bank account
If you want to avoid any confusion when it comes to managing your business's money, it's a good idea to open a separate business bank account. Having a bank account set up in the corporation's name is required by law. Without it, the company's suppliers and clients will be unable to make payments. If you're running your company as a sole proprietorship or partnership, however, you still need to establish a legal entity for your business. business bank account has many benefitsAdvantages of a business bank account are manifold. During tax time, you'll be thankful for its assistance with sound bookkeeping procedures. Having a separate bank account for your company can simplify tax audits and allow you to write off account maintenance costs. To find the best banking solution, it's important to consider your priorities. business accounts you can open with RBCRBC offers business checking and savings accounts.
RBC's business bank account opening process is quick and painless. Online applications take less than 15 minutes to process, and the new business bank account number is immediately available. It's possible that you'll need to verify your identity at a branch before your account can be activated and finalized. To learn more, visit the opening an RBC business accountEstablishing a Commercial Account with RBC
If you open a business account after registering your company with Ownr, we'll give you a bonus. If a business opens a bank account with RBC within 60 days, the business owner can receive $100 for a sole proprietorship or $300 for a corporation. See full details on the offer hereGet the deal's full details right here!
Protect your company's financial future in step 8.
Some new ventures can get started with very little funding, while others require much more. List of possible sources of financial support
Support for private enterprise from the federal government in the form of grants and loans
The Government of CanadaDepartment of Canadian Governance offers a variety of financial aid for entrepreneurs in the form of grants, tax credits, financing programs, wage subsidies, and other avenues.
Need temporary help in a specific area, such as digital marketing, web design, programming, or event planning? federal student work experience programStudent Work Experience (SWEP) Program provides wage subsidies for businesses that hire students for term-time jobs This can be a cheap way to get things done faster and make connections with people you might want to hire in the future.
Financial support for Ontario companies
The province of Ontario has small business funding programs funding programs for small businesses are available in Ontario. grants for employee education and development to benefit Indigenous and Northern Ontario small businesses It's also a good idea to see if any local or regional innovation centers provide financial aid to local entrepreneurs. Research the small business grants available in Ontariofinancial aid for Ontario's small businesses
Angel investorsFunding from "Angels" funding (and sometimes mentoring) in exchange for equity in the company.
Fundraising platforms such as Kickstarter , Indiegogo , GoFundMe , and Patreon (for makers) tap into the collective power of individuals and groups to raise substantial funds. Just too many options to pick from Find out more about how to choose a crowdfunding platform tips for selecting a crowdfunding site ideally suited to the needs of your startup
Take the necessary steps to obtain licenses and permits for your company.
To legally operate, many businesses need special authorization from the government. As was stated before, BizPal provides a comprehensive catalog of possible business licenses and permits It is possible to narrow your search based on factors such as your geographic location, the type of business you run, and the services you provide. Understanding and securing all necessary licenses for your business is crucial.
In most cases, a sole proprietorship or partnership will only need the business name registration registration of a trade name (previously referred to as an MBL) You should include the name and address of your company here. business numberfinancial tally and a rundown of what you do for a living
Think about the possibility that you'll need permissions beyond what's already needed to launch your business. It is common practice for events and photoshoots to need specialized permits, such as those needed by photographers.
Ten. Invest in insurance to safeguard your company.
Having proper commercial insurance coverage is essential. Having the right insurance in place can shield you or your company from potentially ruinous financial losses in the event of a lawsuit or other business liability. Different types of coverage are available for small businesses, and the one that is most appropriate for your operations will be determined by a number of factors. Although there is little danger in running a one-person business out of your home on a laptop, if you offer a service to the general public that puts customers or clients at risk, you may want to consider purchasing additional insurance.
Choose from the following suggestions. what kind of business insurance your small business needswhich types of insurance policies would best suit your company
- Insurance against general risks
- Company property coverage insurance
- Protecting a company's revenue with an insurance policy
- Compensation for injured employees
- Expert Witness Liability Coverage
- Security of Data Contracts
- Company car coverage insurance
To ensure your company is adequately covered, it is best to consult a commercial insurance broker who specializes in business operations.
Eleven. Expand your brand's visibility
Your company is nearly ready to go live; now is the time to spread the word and begin attracting customers. It's important to tailor your advertising approach to the specifics of your industry and target audience. marketing budgetBudgeting for Promotion to connect with them, but there are a few good options:
- Use interesting material to increase your social media following.
- Utilize email marketing to get in touch with customers directly, thereby fostering brand loyalty and boosting sales (think about using HubSpot or MailChimp if you want to outsource this task).
- Invest in social media to expand your audience and increase sales.
- Place ads in regional media to target a particular audience.
- In order to raise awareness of your brand, you should take part in events (while keeping an eye out for in-kind sponsorship possibilities).
- Make connections with other business owners and marketing/events planners in your area.
Twelve, get some help and expand your business
The success of your marketing efforts should prompt you to think about expanding your business. scale your businessraise the profile of your company in order to save time and effort, certain tasks can be automated. One more major step forward is hiring employees for your small businessRecruiting workers for your startup
As a first step toward laying the groundwork for expansion, a company can automate tasks and processestask and process automation Everywhere It's Doable Sending out proposals, invoices, and accepting payments can all be automated with the help of software, as can sending emails to customers in bulk and scheduling social media posts in advance. Having eventime help can release time for development. A virtual assistanttechnical aid while a freelance social media manager can handle strategy, content creation, and engagement, a virtual assistant can manage your calendar and invoices, payments, and customer inquiries
It's possible that even for sole proprietors, there will come a time when supply will outstrip demand. The right people on board can help take your business to the next level, whether you have the resources to hire full-time employees or opt to outsource some work.
You might need to hire specialized professionals for certain tasks, such as a lawyer to draft a contract with your company's vendors or an accountant to keep track of your financials and file your taxes.
Questions and Answers for Potential Ontario Business Owners
How do I get my business off the ground in Ontario?
In Ontario, the first requirement for launching a company is a concept for a service or product. As a result, if you follow the aforementioned 12 steps, your business in Ontario will be well-positioned for success. Registering your small business with OwnrOwnr is a business registration platform that allows you to easily manage your company. will streamline the procedure and give you confidence that your company is in accordance with all regulations.
Just how much does Ontario's small business registration fee typically run?
Small business registration fees in Ontario vary with the chosen business structure. Creating a business entity as a sole proprietorship or partnership is the easiest and least expensive option, costing only to register online, by mail, or via email. The cost of forming an Ontario corporation can be between $300 and $360.
Ownr's business registration services cost $49 for a sole proprietorship and between $499 and 9 for an Ontario corporation, depending on whether you choose federal or provincial incorporation. Explore Further: pricing ...and the benefits of becoming a member sole proprietorshipproprietorship by one person only or incorporating your business with OwnrOwnr is a company formation service. such as 365 days of free Minute Book software
Can an organization be legally established in Ontario without a valid business license?
While specifics like your physical location, company structure, and the goods and services you sell will influence whether or not you need a business license, operating a business in the United States typically necessitates one of several different types of business licenceObtaining a Permit to Do Business to operate Finding out what kinds of licenses and permits your business needs is a breeze when you use. BizPal , a no-cost resource for identifying local authorization needs
I have no money, but I would like to start a business.
Some small businesses need very little money to get started, such as those where the owner works from home providing a service (such as freelance marketing and writing or virtual assistant work) using equipment and supplies that are already in use. To make money onlinegenerate income online , you might not need much to launch (beyond the costs of registering your business; in fact, if you're running a sole proprietorship under your own name, you might not even need to do so). A larger initial investment is needed for some businesses because of the need for inventory, packaging, and promotional materials when selling a commercial product.
In Ontario, what would you recommend as the best businesses to start?
In Ontario, as elsewhere, the best small businesses are those that address a specific need in the community. It's also crucial that the business owner himself or herself be enthusiastic about the enterprise's potential. Find motivation with these home-based business examples the best businesses to start on InstagramUsing Instagram to Launch a Successful Business as well as look into the best small businesses to start in TorontoTop Toronto-Based Startups If you've already got a fantastic idea for a business, then consider how to validate itvalidating it and how or put its potential to the testtry to realize its full potential Before you launch your startup, it's important to consider the following.
Increased access to Ontario business startup resources
We hope these supplementary materials will help you on your journey to becoming a successful entrepreneur. You can also find helpful tools, workshops, and other resources at your local small business center at no cost to you as you embark on your entrepreneurial venture.
With this detailed guide, you should be familiar with the fundamentals of getting your business off the ground in Ontario. Go for it
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