How Do I Incorporate and Why Would I?

Incorporating your business can provide significant benefits, including limited liability protection and potential tax advantages. To incorporate, you typically need to follow several steps.

First, choose a unique business name and ensure it complies with your province's regulations. Next, select a jurisdiction for incorporation—this could be federal or provincial, depending on where you plan to operate. After that, you must prepare and file articles of incorporation, which outline your business's structure, including information about shareholders and directors.

Once your incorporation is approved, you'll need to obtain a business number and register for necessary taxes, such as GST. It’s also wise to draft bylaws that govern your corporation's operations.

The primary reason for incorporating is to protect your personal assets from business liabilities. As a corporation, your personal finances are separate from your business’s, safeguarding your home and savings in case of legal issues or debts. Additionally, corporations may benefit from lower tax rates and increased credibility with customers and suppliers.

While incorporation involves additional costs and paperwork, the long-term advantages often outweigh the initial challenges. Consulting with a legal or financial advisor can help ensure you navigate the process smoothly and make informed decisions.