Starting a business in Canada: A guide for Indian residents with requirements, fees, and opening Canada business account

Canada has a business-friendly environment which can make it a strong choice to launch a business. If you are thinking of opening a company in Canada, you can expect a relatively straightforward process. Learn more about what to expect when either registering a company or opening one from India, and how much it may cost.

Can you register a company in Canada from India?

Yes, Indian or foreign citizens can register a company in Canada but there are certain limitations, requirements to meet and steps to take. The registration process can be done by yourself, or with the help of a professional or agent at a cost.

If you already have a registered business in India and you would like to change domicile to Canada or open a representative office, both are possible. You will need to register your business with the Canadian government and decide the type of business structure you would like to hold. Documents showing your existing business will be required, and you may need to change your business name in case a company already has that name in Canada.¹

No matter the type or size of your business, you will need to register it in one of the Canadian provinces or territories and you may need to get a federal business number. Corporations will need to register with the Canada Revenue Agency (CRA) and get a corporation income tax account.

One thing to keep in mind is that there can be different regulations depending on the province or territory you are looking to register your business. The Canadian government offers relevant business support information on their website. ²

Different types of companies in Canada

There are three main types of business structures that you can open in Canada:

• Sole proprietorship: This type of company is ideal for small businesses with one owner. A sole proprietorship can be easier to manage than the other options and can be a good idea if you are starting a creative or small business like a bakery. However, the owner takes personal responsibility for all debts and profits are taxed at personal income tax rates.
• Partnership: A partnership has more than one owner, but otherwise can feel similar to a sole proprietorship. The partners are still responsible for debts as the business is not a separate legal entity. The split of revenue and profits is determined by the partners themselves.
• Corporation: A corporation is a business that has its own legal entity which is separate from the owners and shareholders. Corporations tend to have more requirements and paperwork, but they also protect individuals from responsibility from the company’s debts or obligations. Corporations need to be federally incorporated in Canada. A corporation also pays taxes as an entity and can set up directors.

Choose a business structure that works for you and your company and that aligns with your future goals. Small businesses, whether shops, food stalls or small agencies, are likely to be better suited as a sole proprietorship or partnership. While large companies, like in banking or mining, looking to establish themselves in Canada can find a corporation a better fit.³

Requirements to start a Canadian company from India

There are requirements to meet to start a company in Canada from India. Here are the steps to take, no matter the business structure:⁴

1. Choose your business structure. It can be a sole proprietorship, partnership or corporation.
2. Choose a business name. The name must be unique and not already held by a business in Canada. Search the Canadian corporate name database and the database for business registries to make sure your name is not taken. Also, check the business database for your province; a business name in a province does not automatically give its name rights at the federal level.
3. Register your business with your government.
4. Identify any licenses and permits you may require.
5. Open a business bank account. The banks will ask to see your business registration documents.
6. Make a plan to pay taxes. Small business owners can get free tax help from a liaison officer from the CRA.

You will need to have the right visa to work and live in Canada for your business. Startup founders, entrepreneurs and individuals in the space of culture and athletics can consider one of the Canadian government’s entrepreneurship visa programs to help immigrants. Check out our later section on moving to Canada from India.

What does it cost to run a Canadian company?

The cost of running a business in Canada depends on a couple of different factors, including the size of the business, its industry, the target consumer and its location. Here are some common costs to expect when running a business in Canada:

• Employee salaries and benefits: This is generally the biggest expense for most businesses. Location matters here as salaries for a company in Toronto are likely to be higher than in rural areas of Canada.
• Rent and utilities: Many modern businesses may not have office space but may require purchasing hot desks or coworking memberships as part of this cost.
• Equipment and supplies: Whether it is mobile payment software, laptops or machinery, equipment and supplies can have a single or ongoing cost.
• Marketing and business development: These costs can help grow and scale a business and should be budgeted for.
• Taxes: Owners or the corporation will need to pay taxes on their income and profits.

Having the funds ready to pay for these starting costs is necessary to get a business off the ground.

Starting costs for setting up the company

The cost of setting up a Canadian business will depend on where you register and operate your business. Generally, it can cost between $60 to $1,000 CAD to register a business in Canada, depending on the province or territory. ⁵

Here is an example of registration and renewal costs in the province of Ontario. Other provinces may have a different fee structure:⁶

*As of 12 October 2023

Some provinces may also have a Name Request fee which allows you to request and reserve a name for your business; for example, in British Columbia, the fee is $30 CAD.⁷

There may be additional fees, depending on your industry and if you want to conduct business outside your selected province. Nearly all the provinces allow for online registration and payment by credit card or by mail.

Taxes and Government Fees

Your business structure and province will determine most of your taxes and government fees. While corporations will have to follow a specific set of rules as far as taxation of the legal entity, sole proprietorships and partnerships that earn more than $30,000 CAD for four consecutive calendar quarters will have to charge a GST/HST on taxable sales.⁸

Starting a business account for a Canadian company

A business bank account is key to getting your business running in Canada. Once set up, you will be able to make payments, invoice and receive payments. Canadian banks like Scotiabank and TD Bank can help small to large businesses, while a bank like BDC is specifically geared towards entrepreneurs.

Most banks will let you open an account online as long as you are a Canadian resident or have the appropriate work visa and the documents necessary. Non-residents or citizens will need to meet with a branch representative in-person. In both cases, you will likely be asked for all the owner’s personal details, a document showing the company name, and the CRA registration, if applicable.⁹

Read more about opening a business bank account in Canada.

Compare business account options by considering features, ease of use and fees, especially if you are managing your business between India and Canada. A great mobile app, ease of international transfers, clear exchange rates and quick deposits overseas can make all the difference when working across time zones. Want a business account that helps your business go global? The Wise Business Account can help.

Meet Wise Business

The Wise Business Account enables you to send and receive money around the world at low fees and with mid-market exchange rates. This means that you can avoid hidden fees and exchange rate markups charged by banks and other traditional money transfer providers. So if you have suppliers in India or a team in Europe, while managing a business in Canada, this account can make payments and invoices seamless.

And to make getting payments even easier, Wise Business offers account details in multiple currencies. So clients can deposit payments in currency that is easiest for them, rather than making transfers to an overseas account.

Our online process lets you open and verify your Canada business account from India. With our customer support available in English and our commitment to providing a seamless digital experience, Wise offers an ideal alternative to traditional banks for your business abroad.

Business categories supported on Wise 👉

Moving to Canada from India

There are a few visa options to start or open a business in Canada as a foreigner. First, if you are already in Canada, check your visa to see if you are eligible to work. Student visas may have limitations while a tourist visa generally does not allow for work in the country. If you already have a work permit or employment visa, take a look at the fine print of your visa and get in touch with your province or territory government to see what you need to register a new business.

Entrepreneurs who are looking to move to Canada can apply for unique visas specifically made for founders or self-employed individuals.

Startup / Entrepreneur Visa Program

Here are two programs that Canada offers for startups or self-employed Indians:

• The Start-up Visa Program: This program is for non-Canadians who have an innovative idea that they want to turn into a business in Canada. The idea must be able to compete in the global market and create jobs in Canada. Applicants will need to pitch the idea to a VC or investor fund, meet a language requirement and have enough funds to settle in Canada.
• Immigrating to Canada as a self-employed person: This visa is only available to applicants who have been self-employed in cultural activities or athletics for more than two years and are willing to contribute their skills to Canada. You will have to show intent to stay self-employed after immigrating. Education, age and language ability are all taken into consideration when making a decision. This may be an option for professionals in the arts.

If you are looking to settle in Canada long-term, there are ways for temporary residents to have a pathway for citizenship.

The Invest in Canada program is also available for those looking to provide foreign direct investments into the country or grow their business.

Cover photo by Alesia Kaz on Unsplash.