A corporation is owned by shareholders. No shareholder of a corporation is personally liable for the debts, obligations or acts of the corporation. However, directors could be held personally liable for the debts of the corporation.
A corporation can incorporate at either the federal, provincial, or territorial level.
A corporation is identified by the terms "Limited," "Ltd.," "Incorporated," "Inc.," "Corporation," or "Corp.". Whatever the term, it must appear with the corporation name on all documents, stationery, and so on, as it appears on the incorporation document.
Characteristics of a corporation:
- it is its own legal entity
- businesses of all sizes can be corporations
- shareholders cannot claim any loss the corporation sustains
- shares can be bought and sold without affecting the existence of the corporation
- it must file a T2 Corporate Income Tax Return
If you want to incorporate your business, depending on whether you want to incorporate provincially, territorially, or federally, you should contact your provincial/territorial incorporating authority or Industry Canada.
Forms and publications
- Guide T4012, T2 Corporation - Income Tax Guide
- Booklet RC2, The Business Number and Your Canada Revenue Agency Program Accounts
- Form RC1, Request for a Business Number (BN)
- Business Registration Online
- Canada Business Network
- Related provincial and territorial government sites
- Industry Canada
- Advantages and disadvantages of each ownership type
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