What’s the best way of setting up your business?
Should it be a sole proprietorship, partnership, or its own entity? The team at Navigator Law is here to help you set up your organization to achieve tax effectiveness and—depending on your needs—separate your assets from those of your business.
Call us to book a consultation on how your company should be set up to be most effective for your needs!
contact usClick Mecontact usProperly structuring your business is one of the most important choices you have when starting your business.
Regardless of whether you run a one-person business, a small business, or a larger firm, you have to make a decision about corporate structure.
How you structure your business has both legal and tax implications, so you’ll need to set up your business in a way that best suits your business type and business needs.
Each type of corporate structure has certain benefits and drawbacks, including personal liability, tax efficiency, and level of administration. A business lawyer or commercial lawyer can help advise you on what type of structure might work best for you and your business.
Our experienced business lawyers can help provide the legal advice you need to set up your business in a way that works best for your needs. Here are some of the common options available.
A sole proprietorship is the simplest form of corporate structure. It is an unincorporated business that is owned by one person. You can register your business name or operate the business under your own name (or both).
When you own a sole proprietorship, you receive all profits from your business, but you also, personally, assume all risks.
With a sole proprietorship, you pay personal income tax on your business revenue and don’t have access to the same tax benefits as a corporation does.
A partnership is when 2 or more people or corporations join together to start a new business. This type of business structure can work well for small businesses to large firms.
It’s a less formal business structure that is administratively easier to form than a corporation, for example.
When forming a partnership, there are also several partnership options available:
Our law firm can guide you through the benefits and drawbacks of the different types of partnerships. We can also help you and your business partners draft an effective partnership agreement that sets out the terms of your partnership and prevents legal issues in the future.
Read MoreClick MeRead MoreWhen you incorporate your business, you set up a separate legal entity from the business owners. A corporation has many of the same rights and responsibilities as a person and can open bank accounts, take out loans, buy assets such as real estate, sue and be sued.
While incorporating your business is a more complex process, it also has several benefits.
A corporate lawyer can help you navigate the incorporation process, help you set up your corporation, draft bylaws, and assist with ongoing corporate governance issues.
Read MoreClick MeRead MoreWe have developed the expertise to help guide your acquisition. Whether you are a small or medium-sized firm, we are here to help.
Just because you structured your business a certain way from the beginning doesn’t mean that you are bound by that decision forever.
Business owners might want to change their corporate structure as their business grows, as part of a sale or a merger, or to respond to financial difficulties.
If you are interested in restructuring your existing business, Navigator Law can help walk you through what options are available to you and what the implications of restructuring will be.
We can help you with all aspects of changing your business structure from conducting due diligence before a business purchase or sale to protecting intellectual property rights and effective tax planning.
At Navigator Law, our experienced lawyers can help advise you on setting up, structuring, and restructuring your business, but our legal services extend far beyond that.
We can help with all your business’ legal needs, including:
Our legal team can draw from our experience in other practise areas such as tax law, estate law, and real estate law to give you all-encompassing advice throughout the life of your business.
Unsure how to structure your business? Contact our law office today to set up an appointment or to learn more about our services.
Do I have to decide on a corporate structure for my business right away?
Yes, for legal and tax purposes, you need to decide on which corporate structure you want to operate under when starting a business. However, if your needs change, you can always change your corporate structure.
What are the options for setting up my business?
In Canada, there are 4 main types of business structures: sole proprietorship, partnership, corporation, and a co-operative. However, a co-operative is not a common type of business structure.
What is a Limited Liability Company (LLC)?
An LLC doesn’t exist as a business structure in Canada, but is a common option for US and UK businesses. If you’re looking for a corporate structure that provides limited liability, incorporating your business might be the best option. Consult a legal professional for more information.
What is a professional corporation?
Essentially, a professional corporation is an alternative to LLPs for certain professions. A professional corporation is a corporation that is owned by 1 or more professionals such as lawyers and doctors. A professional corporation offers many of the same tax and liability advantages as incorporating any other business.
Are there different types of corporate structures across Canada?
Options for structuring your business are the same across Canada. Regardless of whether you start your business in Toronto, Ontario or Calgary, Alberta, you have the same options available although the process for registering your business, incorporating, and specific tax and legal implications may vary among jurisdictions.
