Incorporating your business in BC gives you limited liability, tax planning options, and a professional structure that grows with you. Here's exactly how to do it — and what to think about before you file.
Incorporating a business in British Columbia is one of the most important legal decisions a business owner can make. It creates a separate legal entity — the corporation — that can own property, enter contracts, and carry on business in its own name. As a shareholder, your personal liability is generally limited to what you invest in the company.
Should You Incorporate? The Key Reasons
The most common reasons BC business owners choose to incorporate:
- Limited liability: Your personal assets are generally protected from business debts and lawsuits. A sole proprietor's personal assets are fully exposed.
- Tax advantages: Corporations pay the small business tax rate (currently a combined 11% federal and BC rate on the first $500,000 of active business income), which is lower than most personal marginal rates. Income can also be timed — paid out as salary or dividends in the year that makes the most tax sense.
- Credibility: A BC Inc. signals to clients, suppliers, and lenders that you are operating a serious, permanent business.
- Continuity: A corporation continues to exist even if the owner dies or leaves. A sole proprietorship does not.
- Investment and growth: Corporations can issue shares to investors, employees (through stock options), or other owners.
BC Incorporation vs Federal Incorporation
In Canada, you can incorporate under the *Business Corporations Act* (BC) or federally under the *Canada Business Corporations Act* (CBCA). Key differences:
| Feature | BC Incorporation | Federal Incorporation |
|---|---|---|
| Name protection | BC only | Across Canada |
| Name search required | Yes | Yes (NUANS report) |
| Annual filings | BC registry | Federal + extra-provincial registration |
| Best for | BC-focused businesses | Businesses operating across provinces |
Most BC small businesses incorporate provincially. Federal incorporation makes more sense if you plan to operate in multiple provinces under the same name.
Step-by-Step: How to Incorporate in BC
Step 1: Choose and Reserve Your Corporate Name
You can incorporate with a numbered name (e.g., 1234567 B.C. Ltd.) or a descriptive name (e.g., Coast Legal Services Inc.). If using a descriptive name, you must conduct a name search through BC Registry Services to confirm it is not already in use or too similar to an existing name. A lawyer can help identify whether a proposed name is available and compliant.
Step 2: Prepare the Incorporation Documents
BC incorporations require:
- Notice of Articles — sets out the company's name, share structure, and the restrictions (if any) on share transfers
- Articles — the internal rules governing how the company operates (directors, meetings, share transfers, etc.)
BC's Business Corporations Act provides a default set of articles (the Table 1 articles) for simple structures, but most businesses benefit from customized articles — particularly if there are multiple shareholders or specific governance needs.
Step 3: File with BC Registry Services
The incorporation is filed electronically through BC Registry Services (formerly BC Corporate Online). The filing fee is currently $350 for a BC incorporation.
Step 4: Set Up Your Corporate Records Book
A BC corporation is required to maintain a records book containing: the Notice of Articles, Articles, minutes of directors' and shareholders' meetings, share register, and other key documents. This must be kept at the registered office or records office.
Step 5: Issue Shares
After incorporation, the founders receive shares in exchange for their investment. The share structure and how shares are issued has significant tax and legal implications — particularly if you plan to income-split with a spouse or family trust, or if multiple founders are involved.
Step 6: Open a Corporate Bank Account and Get Your Business Number
With your Certificate of Incorporation, you can open a corporate bank account and register for a Business Number (BN) with the Canada Revenue Agency — which you'll use for GST/HST, payroll, and corporate tax filings.
What a Lawyer Adds to the Incorporation Process
The technical act of filing is straightforward. What a lawyer provides:
- Advice on share structure (how many classes, what rights — critical if there are multiple shareholders or you want to income-split)
- A shareholders agreement (essential if there is more than one shareholder — see below)
- Articles tailored to your business rather than the generic defaults
- Advice on director and officer roles and liability
- Guidance on the transition from sole proprietorship or partnership, including asset transfers
Incorporating without professional advice can create problems that are expensive to fix later — particularly around share structure and tax planning.
The BC Registry filing fee is $350. Legal fees for a lawyer-assisted incorporation typically range from $1,000 to $3,000 depending on complexity — including share structure advice, custom articles, and a shareholders agreement if needed. A simple one-person incorporation with no shareholders agreement is at the lower end; a multi-founder incorporation with a custom shareholders agreement is higher.
Once all documents are prepared, a BC incorporation can be filed and processed within one to three business days through BC Registry Services. The preparation of custom articles and a shareholders agreement typically takes one to two weeks, depending on how quickly decisions are made about share structure and governance.
Not legally required, but strongly recommended whenever there is more than one shareholder. A shareholders agreement sets out how decisions are made, what happens if a shareholder wants to leave or dies, how disputes are resolved, and what restrictions apply to selling shares. Without one, disputes between shareholders are governed by the default rules of the Business Corporations Act — which rarely match what the founders actually intended.
Yes. BC's Business Corporations Act does not require directors or shareholders to be Canadian citizens or residents. A BC corporation can be fully owned and directed by non-residents. However, there are tax implications for non-resident shareholders receiving dividends from a BC corporation, and professional advice is important to structure things correctly.