Are you ready to go from employee to entrepreneur? 

Small business owners drive the Ontario economy. They make up 97.7% of the businesses in the province, and that doesn’t include the more than 1 million Ontario workers who are self-employed. They may be small businesses, but their impact is enormous.

Here’s how to get ready to make an impact with your new business endeavour.

Steps to Start a Business in Ontario

There’s more to a successful business than having a great business idea. You need to have a solid foundation to work off. To do this, you need to do some planning, research, and administration work – like getting business insurance – early in the process to ensure you’re set up for success.

Business partners happy to have launched their business.

Prepare a Business Plan

A business plan is an essential document. It includes details on everything from your company profile and market research to the physical resources the company will need (like equipment) and financials. Your company’s road map will help you make better business decisions along the way, and it’s the document you’ll give lenders and investors if you need financing.

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Because of its importance, there are many resources available to help:

Decide On an Ownership Structure

Businesses in Ontario can be set up in one of four ways: sole proprietorship, partnership, corporation, or cooperative.

  • A sole proprietorship is a business owned by one person. You benefit from the profits alone, but you’re also responsible for all the debts and losses. It is the most common set-up for a new business in Ontario.
  • A partnership is similar to a sole proprietorship, except two or more people own it. Decisions regarding the business and the rewards and risks are shared.
  • A corporation is a separate legal entity from its owner(s). As such, it limits the personal liability of those who own the company.
  • A cooperative is a corporation run by members who have an equal vote on business matters.

Each ownership structure has its advantages and drawbacks, and you’ll have to decide which works best in your circumstances initially and as your business grows.

Find Out If You’ll Need a Business Licence or Permit

Licensing and permit requirements will vary by business, industry, and jurisdiction. Fortunately, BizPal will help you (for free) determine which federal, provincial, or municipal licences and permits you may need to operate.

Note: Having the appropriate business licence or permit isn’t the same as registering your business with the province. It is a different requirement.

Register the Business in Ontario

Most businesses in Ontario must be registered. There’s one exception: if your personal name matches your business name. For example, if your first and last name and business name are Jane Doe, you can forgo registering your business. However, you cannot if your business name is Jane Doe Consulting.

The steps to registering your business will depend on the type of business structure you’ve chosen. For example, registering as a sole proprietor or partnership is generally more straightforward than incorporating.

Regardless of the registration type, start with a name search to ensure no other businesses with the same name. Search the Ontario Business Registry to see if your chosen business name is already in use in the province. If you’re planning on incorporating, you’ll also want to do a NUANS name search.

Once the business is registered with the Ontario Business Registry, it’ll be automatically registered with the federal government as well. Upon registration, you’ll have an Ontario Business Identification Number and a federal business number. The latter is needed, for example, if you’re required to collect GST/HST and need to set up an account with the Canada Revenue Agency (CRA).

Get a GST/HST Number

You’ll likely have to collect GST/HST while doing business. It’s unavoidable for most unless you’re classified as a small supplier. A small supplier is generally a business with revenues that do not exceed $30,000 over four calendar quarters. Even if you’re a small supplier, you can voluntarily register to collect GST/HST to avoid doing it later as your business grows.

Learn more about GST/HST:

Explore Your Financing and Funding Options

You don’t have to go it alone solely on your personal funds. There are many resources available to help small businesses get started, whether it’s a small business grant or a loan from a bank. Sometimes all you need is to be pointed in the right direction.

Get Acquainted With Regulations That May Affect Your Business

There are regulations in place that businesses must abide by, and depending on the nature of your business, they may also affect yours:

Secure Ontario Business Insurance

There’s already plenty to worry about when it comes to starting a new business. And while every business is different, there are a series of business insurance  products that can be bundled into a comprehensive policy to will help protect your company, including:

  • Commercial property insurance: Commercial property insurance provides coverage against physical loss or damage to your building, contents, stock, and equipment. Often, it’s bundled with business interruption coverage which pays for lost income while your business is closed due to an insured loss, like fire.
  • Commercial general liability (CGL) insurance: CGL covers claims against your business for bodily injury or property damage to other people. This type of coverage would apply, for example, if a customer has a slip and fall accident at your business and is injured or an employee damages property at a client’s site.
  • Errors and omissions (E&O) insurance: E&O insurance provides protection against claims from customers who allege that something your company did or didn’t do resulted in them losing money or causing them harm in some way.

Get the best rates, hassle-free, for all your commercial insurance needs from Zensurance as you prepare to ‘open for business’.

– Reviewed by Mario Petramala, Team Lead, New Business, Zensurance.

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About the Author: Liam Lahey

Liam is the Content Marketing Manager at Zensurance. A writer and editor for more than 20 years, he has been published in several newspapers and magazines, including Yahoo! Canada Finance, Metroland Media, IT World Canada and others.