Place of Incorporation

The question as to whether you should incorporate your business also involves deciding whether your business should be incorporated under the federal laws of Canada (i.e., a federally chartered corporation) or under the laws of one of the provinces of Canada (i.e., a provincially chartered corporation).

Federal vs. Provincial Corporations

If you intend on carrying on business only in one province, you may choose to incorporate either a provincially chartered corporation under the laws of that province or a federally chartered corporation. If you incorporate a provincially chartered corporation, you should be aware that if you intend to carry on business in that province as well as in other Canadian provinces you must register as an extra-provincial corporation in every province in which you will carry on business.

Furthermore, there are other issues that you may consider in selecting where you incorporate your business:

  1. the government fees of a federal chartered corporation versus a provincially chartered corporation; and
  2. determining the advantages and disadvantages of each jurisdiction's corporate laws and tax structure.

If you require additional information to make an informed decision as to where to incorporate your business, we suggest you contact competent legal and tax professionals and discuss these matters with them.