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May 24, 2011 - 3 minute read - Comments - legal

Choosing A Provincial Or Federal Corporation In Canada

Corporations in Canada can be registered at either the federal or provincial level. If you are registering a federal corporation the first step is to order a [NUANS report][1]. This is a preliminary search that must be conducted to see if the name you have chosen for your company is available. The report can be ordered online for $20 or you can get one in person from a NUANS member organization.

The NUANS report won’t reserve the name for you. It will just give you an indication of whether the name has a serious conflict with that of another company. If the NUANS report does not seem to show a conflict you can apply for corporate name pre-approval. It isn’t necessary to file for pre-approval, you can apply for name approval when you file your articles of incorporation. You will have to include your NUANS report with your incorporation documents if you choose this option.

It is possible to file your articles of incorporation and pay your fees online, by email, by fax or by mail. While it is possible to complete and file your own incorporation documents, unless you are experienced in this area, I wouldn’t recommend it. I would recommend that you order a NUANS report and apply for corporate name pre-approval but then I would hand the process over to a lawyer or a service like legalzoom.ca.

A good corporate lawyer will give you the best set of legal documents because they will be tailored to your specific situation. Your lawyer can also look after other things like a shareholder agreement at the same time. Legalzoom.ca can be a good choice for someone on a budget as you will get a set of documents that are acceptable, but not highly customized to your situation.

Your corporation will be incorporated federally and registered provincially in the province where your head office is located. Additional provincial registrations can be added if the scope of your business operations will extend to those provinces. The procedure for provincially incorporating a company varies from province to province. It is important to note that the provinces do not recognize a NUANS report. A name search and approval must be conducted with the province in which you wish to incorporate.

It can cost less that $750 to provincially incorporate in a province like Ontario. A federal corporation will cost about $1,000 with added fees for each additional province you register in. These fees would be representative of doing it yourself or using a low cost provider. Using a lawyer could cost $2,500 or more but it could be well worth it, especially if your business is complex.

If you plan to never do business outside of your home province, a provincially incorporated company might make sense. Otherwise a federal corporation brings the advantage of being registered nation-wide with the ability to register in individual provinces if necessary. Incorporating a company might seem like a stressful task but if you look after getting your name pre-approved and then hand it over to a professional, it can be relatively painless.

[1]: https://www.nuans.com/eic/site/075.nsf/eng/home(NUANS Report)