A corporation is a legal entity that is created under Canadian or Provincial laws. A corporation is owned by shareholders and controlled by a Board of Directors. It can run a business, hire employees, sign contracts, conclude transactions…etc.

The principal advantage of incorporating is the limited liability of the shareholders. Corporations also benefit of various fiscal advantages that will allow you to better operate your business and increase your profits.

A shareholder is a person, company or institution that owns a share of a company’s stock. By owning a share of a company’s stock, the shareholder is able to reap the benefits of the company’s success or can be responsible for its losses.

In the event where a corporation has more than one shareholder, it is strongly recommended that the shareholders sign a unanimous shareholder agreement. A shareholder agreement is a contract between the shareholders that establishes rules and answers to various questions namely what happens if a shareholder wants to sell?, what happens if a shareholder dies? or what happens if a shareholder defaults?

A minute  book contains a permanent and detailed record of a corporation’s rules, activities and decisions. It will contain resolutions of corporate minutes and meetings, a list of the shareholders and board of directors members, a securities registry and shareholder certificates. It will indicate the significant positions of the corporation and who has the authority to act in the name of the corporation.

Under Quebec and Canadian law, minutes book are mandatory and must be available at the corporate headquarters.

In the future, if you want to make any changes to your business or if you need specific resolutions to update your minute book, we recommend visiting our corporate maintenance and corporate resolutions pages for more information or you can contact us at the form below.

In order to determine the proper jurisdiction for your corporation, federal or provincial, ask yourself the following questions:

1. Where will my corporation be conducting its business? Will the activities be across Canada or provincial?
2. How important it is that the name and brand of my business be protected across Canada?
3. What are the fees associated with incorporation and provincial immatriculation of your corporation?
4. Will the Corporate directors be Canadian residents?

By doing this analysis, we will be able to better assess which jurisdiction is best suited for your corporation.

Incorporating a provincial business normally takes 72h. As for a federal business, it can take between 48h-72h for the business to appear at the Federal corporate registry.

Finally, it normally takes our firm 10 business days to produce your minute book.

If you pay yourself a salary from the corporation, you will also be paying a contribution which in exchange will provide you with certain social benefits like pension, maternity and paternity benefits. If you plan on having children in the future, this can be an advantageous option.

On the other hand, if you pay yourself in dividends, you only pay taxes on the amount distributed without having to pay for any contributions. Therefore, any excess capital remaining in the corporation can be reinvested.

Yes. If you have a business partner, it is crucial to have a partnership agreement in order to protect yourselves and the partnership. We suggest visiting our partnership agreement page for further information.

A salary is a fixed compensation paid periodically to an employee for the services and work rendered.

On the other hand, the dividend is the distribution of profit made by a company to its shareholders. All surplus in profits made by a corporation can either be reinvested into the company or be distributed to its shareholders as a dividend.

Yes, the incorporation process requires the drafting of various legal documents and having an attorney draft those documents for you would be highly recommended.

If you are looking to close your sole proprietorship and incorporate a new company, we can help with that. For more information, contact us at the form below or visit our convert a sole proprietorship into a corporation page for information.