incorporationquebec

Choice of Jurisdiction Before incorporating a company, it is necessary to determine whether you wish to incorporate under the provincial or federal system. The differences between these two incorporation regimes are discussed in other articles on our blog. A question we are often asked before the incorporation process is: will it be too late to change the incorporation regime once the incorporation is done? The answer is no, it will not be too late. Continue under another

Separate entity A corporation (company) is a separate entity with its own legal personality. As such, the Canadian tax system provides for special taxation to govern the taxation of corporations. A corporation is subject to a corporate tax rate, the rate of which can change depending on the amount of income and the type of income. The following are some (but not all) features of the corporate tax system. Deductions for

Registration Registration (or lack thereof) with the GST and QST files can have significant tax implications for a company. These include the right to claim input tax credits (ITCs/ITRs) for business expenses, or certain tax elections allowing certain supplies to become non-taxable (e.g., the sale of all or substantially all of the assets of a business). What the law provides First, under section 240 of the

Compared to starting a business via a corporation (company), starting a sole proprietorship is legally and administratively simple. Indeed, while the corporation is a separate legal entity that requires the completion of various corporate formalities, the sole proprietorship is a business operated by the natural person who is the owner. If the business owner operates the business solely under his or her first and last name, other than through a

In general, the articles of incorporation of a company provide for different classes of shares as authorised share capital. Authorised share capital means that these shares can be issued by the company, but are not necessarily issued. Unless otherwise specified in the articles, the authorised share capital is unlimited, as an unlimited number of shares may be issued. Furthermore, if the articles do not provide for several classes of shares, the company will be deemed to have only one class,

Filing the Articles of Incorporation When filing the Articles of Incorporation for the purpose of incorporation, the legal name of the corporation (corporate name) must be entered or a numerical designation (numbered company) must be requested in lieu of a corporate name. The corporate name of the company usually ends with "inc." or "ltd.", or other equivalents permitted by law. It is also possible to register, at the

Provincial or Federal Incorporation? When incorporating a company at corporation, the first thing to decide is whether to incorporate under the Quebec Business Corporations Act or the Canada Business Corporations Act. Depending on the situation of each business, it may be preferable to incorporate under one corporate statute rather than another. However, it is undeniable that corporations governed by Quebec law

Both provincially and federally incorporated corporations are required to maintain an issued and paid-up share capital account (federal stated capital account), which is subdivided by class of shares (and series of shares, if applicable). What is this account? This is a notional account, which represents the consideration received by the corporation for each class of shares. Where there are par value shares (at provincial

Corporate legislation, both provincial and federal, allows for various changes in the share capital of a corporation, including share exchange and conversion. These two changes in share capital should not be confused, although the result is often the same. The exchange of shares is a transaction specific to the individual shareholder, and constitutes simultaneously a sale of shares to the company and an issue of shares by the company. The shareholder enters into a share exchange agreement under