Sole Proprietorship

Sole Proprietorship is the simplest and the most inexpensive way to set up a small business in Ontario. One person performs all the functions required for the successful operation of the business. The small business owner must register a business name with the Province of Ontario if it is different from his/her own legal name. For example, if Adam Smith is planning to conduct his business under the name Smart Consulting, he must register it.

Sole Proprietorship

Registration fee - $39 + HST

Government fee - $60

In 0.5 to 3 business hours

If you are going to start your small business with a partner, you should consider registration of an Ontario general partnership.

Registration of new business names takes from 30 minutes to 3 business hours. Renewal of existing business names takes one to two weeks.

Ontario Business name registration is valid for 5 years.

It's important to know, an owner of the small business is fully responsible for his business debts and obligations by his personal assets. Thus, the business owner has unlimited personal liability. If you are interested to get a limited liability company protecting you from the personal liability for your business, you should incorporate your business.

Benefits of Sole Proprietorships

Easy and inexpensive to set up
Little regulation from the government
Directly controlled by the owner/operator
Minimal working capital required
Business is taxed through owner's personal income tax, and losses can be used to reduce taxes on other sources of personal income
Wages payable to a spouse are deductible from the income of the business.

Disadvantages of Sole Proprietorships

Unlimited personal liability
Lack of continuity in business organization in absence of owner
Difficulty in raising capital
Owners are taxed at individual tax rate, which is much higher than corporate tax rate.

Please note our company does not provide legal and tax advise. We recommend you to seek a professional advice from a lawyer, who is authorized to practice law in your province before ordering our company to file your information for registration of your business.