Incorporating your company
- Updated on 02 Jul 2019
The incorporation of a business company allows the creation of an entity distinct and independent from the founder(s) in order to become a legal person (legal entity). In Canada, a corporation can be incorporated under federal or provincial law. By becoming an independent legal person, a company can then hold its own assets and liabilities, which will not be linked to those of its owners (the shareholders). By accumulating assets, the company develops its own financing capacities, which enables it to obtain lines of credit, loans, grants, tax credits, etc. In addition, specific tax rates apply for corporations, regardless of those applicable to individuals. Finally, shareholders also benefit from a risk limit related to the company's activities since they are not, in principle, held liable for the company's debts (unless the shareholder engages a personal guarantee or other exception).
Our startup Lex Start has made a 15 minute course that will help you navigate this. Watch the course here.
This course will help you answer these questions confidently:
- What is the stage of development of your company?
- Are you self-employed and wondering if you should incorporate?
- What is the purpose of incorporation: security for the entrepreneurs who are its shareholders, tax benefits, and the ability to finance ?
- How to choose your name, the famous Inc. (personalized, numerical, assumed name)?
- The differences between federal and provincial incorporation?
- What are the roles within a business company?
- What are the next steps?