LaPierre Law Office Professional Corporation can help you with any of your legal concerns, advise on recommended business structures and prepare all documentation relating to your particular business enterprise. We can provide services and advice with respect to the following:
Starting a new business
Purchase and sale of businesses
Incorporation and organization of federal and provincial companies
Municipal, provincial and federal registration
Extra-provincial registrations across Canada
Shareholders agreements, partnership agreements
Corporate re-organization and re-structuring
There are several different ways in which a business can be organized:
This is one of the most commonly used forms of business organization in Canada today. Sole Proprietors will personally realize all profits and losses, pay all taxes on the profits and be personally liable for all debts and obligations of the business. If you operate your business under your own legal name, you are not required to register with the provincial authority. If you operate under another name you will be required to obtain a business name registration. Depending on the type of business you may be required to obtain a municipal business license.
This form of business organization is very similar to a Sole Proprietor except that there is more than one owner and the owners are called partners. The partners are personally liable for all the debts and obligations of the partnership, and can be liable to satisfy in full all the liabilities and obligations of the partnership. The partner can seek compensation from the other partners. The profits are all shared among the partners in and according to a partnership agreement. The partnership name must be registered with the provincial municipal authority and a business license may be required depending on the type of business.A limited partnership can also be created which limits the amount of liability to the amount of capital invested into the partnership.
Corporations can be formed under federal or provincial law and a corporation is treated as a “distinct person” by law. The owners of the corporation, the shareholders, are not responsible for any debts of the Corporation as long as they have not provided a personal guarantee covering the corporation’s debts or obligations. Creditors are unable to touch any personal assets of any shareholder and this feature makes incorporation ideal for many business situations.
There is a certain amount of paperwork to be completed when establishing a corporation. A corporation is responsible for keeping financial records, preparing annual financial statements, and must also hold annual meetings of its directors and shareholders. The minutes of these meetings must be prepared and filed in the corporate Minute Book each year. A corporation must also file its own federal and provincial income tax return as a separate legal entity.
Whether you are starting your own business or re-thinking the structure of your existing business, it is wise to consider incorporation. Please contact our office so that we can discuss the corporate structure that best suits your business needs.
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