* The Business name
* Business Address (Post office box is not acceptable)
* Mailing address of Registrant
* Individual/s name and address
* Activity being carried out under the business
Legal Smart Service Fee: $29.00
A sole proprietorship is an unincorporated business that is owned by one individual. Most small businesses are sole proprietorships because this type of business is the easiest and least expensive way to start a business. As a sole proprietor, you and your business are considered as one, often called a 'self-employed’. The net business income must be included as part of your personal income and you are fully responsible for all debts and obligations related to your business.
Advantages
Full decision-making authority
Inexpensive start-up cost
Simple business structure
All of the profits are yours, no salary or dividends need to be paid out
Simple tax filing
Things to consider
Responsible for all liabilities
Difficult to rise capital
Difficult to exit or sell the company
Income is taxable at your personal rate
Limited tax planning opportunities
Business name is not protected
Must be renewed every 5 years
It is very important to choose the best business structure when starting a business. It depends on a number of factors as well as your personal goals and comfort levels. Whether you are thinking of incorporating or registering a sole proprietorship, a few factors to keep in mind when making your decision:
| Sole Proprietorship | Incorporation |
|---|---|
| One single owner | Owned by shareholders |
| Inexpensive start-up cost | Initial costs are higher than other options available |
| Full decision-making authority | Overall Flexibility with any change of corporation or individual names |
| Easiest way to structure a business | Can be more complex to set up than a business name registration |
| All of the profits or liabilities are yours | Distinct legal entity and limits the liability |
| Simple tax filing | Enhanced tax flexibility |
A name reservation is not mandatory for a sole proprietorship registration in Ontario or Alberta. It is strongly recommended that you search the name to make sure no one using it before you register your business. If the name deceptively similar to an existing business name, there are a risk of legal action taken by other party.
A company key is a business profile access code that is registered, incorporated, or licensed to carry on business in Ontario. The key is required for any subsequent changing like renewal, change or cancellation of your business.