Legal information

Over the decades, Canadian corporate law has developed in such a way that there are now several notable differences between corporations incorporated in the United States and those incorporated in Canada. As will be discussed below, these differences can be extremely important when a Canadian-incorporated company opens a place of business in the United States to operate a business. We provide an overview of three important differences between the Canadian and U.S. corporate environments. 1. Number

Within a corporation (company) there are different titles and functions. Often these titles and functions are all held by the same person, especially for smaller companies, but this is not always the case. Here is an overview of the differences between the shareholders, directors and officers of a company. Shareholders A shareholder owns shares in a company corporation. His or her shares give him or her certain rights over the company,

Often entrepreneurs will hold the shares of their operating company through a management company, instead of holding the shares directly. We present an overview of the advantages of such a structure. Asset protection An operating company may be at risk of legal action, particularly if it is active in a high-risk area in terms of civil and contractual liability. It may also be at risk if business does not go as planned.

It is quite common for an incorporation to be carried out by the entrepreneur himself, instead of entrusting this task to a competent lawyer. We offer you a list of consequences that frequently occur in such a situation, and which make it strongly recommended that a professional be mandated to incorporate a company. Lack of legal organisation The mere fact of filing articles of incorporation and obtaining a certificate of incorporation

In Quebec and Canada, a corporation is legally constituted on the initiative of a "founder" (incorporator). This is the person who signs the articles of incorporation and applies to government authorities for a certificate of incorporation attesting to the creation of the company. Unlike in the United States, the role of the incorporator in Canada is extremely limited: he or she signs the articles of incorporation (of

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