A sole proprietorship is the simplest way to run a business in Ontario: it is just you, operating as a business. Registering one is quick and inexpensive, and most people can do it themselves in an afternoon. Here is how to register a sole proprietorship in Ontario and what to handle afterward.
Do you have to register?
It depends on the name you use. If you operate strictly under your own legal name (for example, "Jane Smith"), you generally do not need to register a business name. The moment you add anything to it or use a separate brand name ("Jane Smith Consulting" or "Maplewind Studio"), you are required to register that business name with the province.
How to register the business name
You register through ServiceOntario, in what is called a Business Name Registration (formerly the Master Business Licence). You can do it online. You will need:
- The business name you want to use.
- Your personal contact and address details.
- A short description of what the business does.
The registration is valid for five years, then you renew it. One step worth not skipping: search the name first. Ontario will let you register a name someone else is already using, which can set you up for a trademark dispute later. A quick search before you commit is cheap insurance. (This is also part of registering any business in Ontario.)
What comes after
- Get a CRA business number if you will collect GST/HST or hire.
- Register for GST/HST once you expect to pass the $30,000 small-supplier threshold.
- Keep your business and personal finances separate, even though the law treats them as one, to make bookkeeping and taxes far easier.
When to consider incorporating instead
A sole proprietorship is not separate from you, so the business's debts and liabilities are yours personally, and you are taxed on everything it earns. Once there is real liability risk, or you are earning more than you need to live on, incorporating starts to make sense.
If you reach that point, Korporex files your Ontario or federal incorporation online, including the name search, share structure, and minute book, and delivers your documents within 24 hours.