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Difference between Federal and Provincial corp?
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| d!abolic |
| A "regular" (provincial) corporation costs about $500 to open, but someone mentioned that a federal corporation costs only $200. Now, i need to open up a new entity soon, and i'd rather spend $200 than $500. Does anyone know if there is a difference though? If a federal corp costs less, why doesn't everyone use them? |
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| rabbitjoker |
Yes, there is a difference.
If you're going to do business in only one province, you can register as a provincial or federal corporation. Take note: if you've registered as a provincial corporation in one province and decide to to do business in another province you must then register as an extra-provincial corporation within every province that you decide to carry out business in.
If you incorporate federally - there is no need to register in other provincial jurisdictions.
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There are certain tax advantages to being a provincial corporation (vs. a federal corporation) depending on the province. Do some research and you'll find out if (any) tax advantages exist. |
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| drgoodvibe |
| Ontario Corp registration fee is $360 (I did this back in Aug). Federal i'm not sure about. All you need is the $30 name search, and fill out the proper papers and your done. Don't pay a private firm to do it for you because it's simply a ripoff, you can do it yourself in half the time. |
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| drgoodvibe |
p.s as always ..
RJ knows! Sage business advice as always. |
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| rabbitjoker |
Federal Corporation costs:
$30 NUANS Search (optional, only required for named corporation)
$200 Federal Corporation Filing Fee
$10 Ontario Provincial Registration Fee
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$240 TOTAL
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Ontario Corporation costs:
$30 NUANS Search (optional, only required for named corporation)
$360 Ontario Corporation Filing Fee
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$390 TOTAL |
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| rabbitjoker |
One last thought (based on a lesson that, recently, I've had to learn the hard way...):
If one has the funds, I would advise on incorporating in an offshore jurisdiction that protects the privacy of a corporations ownership.
Certain offshore jurisdictions allow incorporation without the directors and major shareholders being made public.
In event of litigation this will protect your personal assets and will assist in limiting your personal liability (remember: just because you are director/major shareholder in a corporation, you are not excluded from certain liabilities).
Basically, if you are sued (right or wrong {I was in the right in the lesson referred to above}) you want to make it hard as possible for the litigant to determine who to sue, who the plaintiff is, who the plaintiff's connections/owners are, etc.
Various offshore jurisdictions provide privacy with respect to corporate structure - if at all possible, incorporate (and pay corporate {not personal} taxes) in that jurisdiction. |
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