What does it mean to incorporate a Business in B.C.?
Incorporating a business means to create a separate legal entity to carry on your business. This separate entity is called a “company” or “corporation”. As a separate legal entity, the company can enter into contracts under its own name, it can have property registered under the company’s name, can have debts under its own name and can sue and be sued in its own name. The owner of the company or corporation is referred to as a shareholder. The owners of the company would not be liable for the debts of the company, unless they have personally guaranteed those debts. In other words, by incorporating you are essentially creating a new person separate from its owners.
What are the Other Ways of Carrying on Business in B.C.?
Business in B.C. can be carried on through a sole proprietorship or partnership.
What is a Sole Proprietorship?
A sole proprietorship is the simplest form that can be used to carry on a business in B.C., it involves carrying on a business under your own name or through doing business as name, which requires registration. In a sole proprietorship, you would be personally responsible and liable for all the debts and income of the business.
What is a Partnership?
A partnership is where two or more persons carry on business together. The individual partners in a partnership are liable for the debts of the partnership unless the partnership is a limited partnership. The income of a partnership is disclosed on the individual partner’s tax returns. To learn more about the differences between a partner, a sole proprietor, and a shareholder, read our blog post about different forms of business in BC.
What are the Advantages of Incorporating a Business in B.C.?
Incorporating a business has many advantages. Some of the advantages are as follows:
- Limited Liability: As the company is a separate legal entity from the shareholders of the company, the liability of the shareholders is generally limited to the amount of money the shareholders contributed by way of payment to the company for the purchase of shares;
- Tax Advantages: An incorporated company has more flexibility with taxes and it may even receive preferential income tax treatment if it meets certain criteria;
- Ease of Raising Capital: As the company can have many shareholders, it may be easier for the company to raise capital from investors;
- Transfer of Ownership: As the ownership of the company is represented by the shares of the company, it may be easier to transfer ownership by selling the shares of the company.
What are the different types of incorporated companies?
In British Columbia, you may incorporate a company under provincial legislation, in which case the company will be referred to as a British Columbia company, or under federal legislation, in which case the company will be referred to as a federal corporation. You may choose to incorporate a federal corporation if the company is expected to operate nationally. However, as the BC legislation and the federal legislation impose different requirements, you should obtain legal counsel on these issues.
What is the cost of incorporating a Business?
The cost of incorporating a business using our standard articles of incorporation is $995 plus taxes and disbursements. For that fee we do not only incorporate your business, we draft all the necessary corporate resolutions, share certificates, share subscriptions, Consent to act as Director, provide and complete your company’s minute book and of course advising you throughout the incorporation process.
Why use M.J. O’Nions Lawyer & Mediator for incorporating your Business?
We have the knowledge, expertise and experience in incorporating a British Columbia company or federal corporation. We can complete all the steps to ensure your company is incorporated properly so you can focus on managing your business. We will do this in a cost-effective manner while providing high quality professional service. We understand your needs and we are here to help.
How do I start the process of incorporating my Business?
Simply contact us by filling out our contact form and a BC business lawyer will call you within 24 hours to assist you, or you can call us directly at 604-449-7779. We would be honoured to be your business lawyer.