Ways to Incorporate in Canada
Choosing an Advisor or Incorporating Yourself - Your Options
Sep 16, 2008
Most people blindly follow the advice of whatever advisor is directly in front of them, without realising there are options when they decide to incorporate. Certainly there are different levels of service in the options available, but there are also costs to be borne.
Incorporating through a Lawyer
Typically when you incorporate through a lawyer you will pay a set fee for the lawyer’s service, plus disbursements. This means that you pay for the government and registry office fees as well as the lawyer’s time. The big advantage to doing this through a lawyer is that you know that everything is going to be done correctly. In addition a lawyer will typically set up your Corporate Minute Book as part of the deal. If they are not doing this, they will let you know up front. Of course, as with anything with a lawyer, you will pay high fees. Lawyers typically charge $300 an hour and up for their work. If a junior lawyer who has been practising for less than two years does it, you may pay as little as $200 per hour. It’s still a lot, so you will be paying at least $300 for these services, not including disbursements. There are law firms that easily charge as much as $450 plus disbursements. They will also charge you for the annual corporate filing, since corporate records (the minute book) are now kept with them.
Incorporating through an Accountant
Many accountants are also familiar with incorporating companies. However, they typically do not offer the minute book set up service. This is something that you will either have to get a lawyer to do or do your self. It is very inexpensive to pick up a minute book kit and do the work yourself. This is usually in the range of $40 or less. The incorporation fee you will pay with an account is also typically less than with a lawyer, most often $250 or less. Some accountants will offer the minute book set up and updating service as an add-on service. This will typically be in the neighbourhood of $100, plus a set annual fee to be billed every year thereafter for maintenance and annual filing.
Incorporating on Your Own through the Registry Office
In most provinces, and nationally, you can easily incorporate yourself. This will save you the fees that lawyers and accountants charge, but it will also cost you in terms of your time. And you will have to know how to do the incorporation. The people at the registry offices tend to be very helpful, but if you go unprepared, you will have to make multiple trips and will waste a lot of your time. Do your research first! Most provincial governments, as the federal government, have excellent web sites that give you full instructions on how to incorporate your business.
All in all, you will have to weigh what your time is worth, and whether it is worth it to you to pay someone to do the legwork for you or if you prefer to save a few dollars and do the work yourself. If you do it yourself, you will save a couple of hundred dollars, but it will take more effort on your part.
Good luck in your new venture!
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For complete instructions on how to incorporate anywhere in Canada, plus detailed information on how to set up your business numbers visit howtoincorporate.ca
