Most BC small business owners focus on building their business and leave the legal side until something goes wrong. Here's a practical checklist of what every BC small business should have in place — and why each one matters.
Running a small business in BC involves more legal obligations than most owners realize — and more risks than those who skip the legal foundation appreciate. This checklist covers the essentials that every BC small business should have in place, regardless of size or industry.
Business Structure
☐ Chosen the right structure — sole proprietorship, partnership, or corporation. Each has different liability, tax, and operational implications. If you are carrying on business at any meaningful scale, incorporation almost always makes sense.
☐ Registered your business name — if operating under any name other than your legal name (for a sole proprietor) or your corporate name, you must register the name with BC Registry Services.
☐ Obtained required licences and permits — business licence from your municipality, any provincial or federal licences required for your industry (e.g., real estate, financial services, food service, childcare).
Contracts and Documentation
☐ Written contracts with clients — clearly defining scope of work, payment terms, intellectual property ownership, and dispute resolution. A handshake agreement is a dispute waiting to happen.
☐ Written contracts with suppliers and subcontractors — particularly important for construction, professional services, and any business relying on third parties for delivery.
☐ Standard terms and conditions (for businesses with regular transactions) — covering limitation of liability, payment, cancellation, and dispute resolution.
☐ Employment agreements for all employees — including a valid termination clause tailored to BC law.
☐ Independent contractor agreements — if using contractors, a written agreement that accurately reflects the relationship and addresses intellectual property, confidentiality, and termination.
Corporate Governance (if incorporated)
☐ Shareholders agreement — if there is more than one shareholder, this is essential. Without it, you have no mechanism for resolving disputes, buying out a departing shareholder, or handling a death.
☐ Up-to-date corporate records — minutes of directors' and shareholders' meetings, share register, and annual reports filed with BC Registry Services.
☐ Annual general meeting held — BC corporations are required to hold an AGM within 15 months of the previous one.
Intellectual Property
☐ Trademarks — if your business name or logo matters to your brand, register it with the Canadian Intellectual Property Office (CIPO). A registered trademark gives you exclusive rights across Canada.
☐ Copyright — original written and creative work is automatically protected, but documenting creation and ownership is important for disputes.
☐ Trade secrets protected — confidentiality agreements with employees, contractors, and business partners who have access to proprietary information.
Insurance
☐ General liability insurance — essential for most businesses. Protects against claims by clients or third parties for injury or property damage.
☐ Professional liability (errors and omissions) insurance — required for many professional services and highly advisable for others.
☐ Commercial property insurance — if you own or lease business premises or equipment.
Tax and Financial Compliance
☐ GST/HST registration — required once annual revenue exceeds $30,000 (voluntary registration below that threshold is often advisable).
☐ Payroll accounts — if you have employees, you need a payroll account with CRA and must remit source deductions.
☐ Corporate tax returns — a BC corporation must file a T2 return within six months of its fiscal year end.
☐ Separate business banking — commingling personal and business funds creates accounting problems and can erode the liability protection of incorporation.
Personal Planning for Business Owners
☐ Will updated to address your business interests — who inherits your shares, and on what terms.
☐ Shareholders agreement includes provisions for death and incapacity.
☐ Enduring power of attorney — who manages your business affairs if you are incapacitated?
☐ Succession plan — even a basic outline of who takes over and how.
Running the legal health check on your business once a year — ideally with a lawyer — is the best way to catch problems while they are small and fixable.
Most BC municipalities require a business licence to operate within their boundaries — even for home-based businesses. The requirements and fees vary by municipality and by the type of business. Some regulated industries also require provincial or federal licences in addition to the municipal business licence. Operating without required licences can result in fines and orders to cease operations.
A sole proprietorship is the simplest structure — you and the business are legally the same entity. Your personal assets are fully exposed to business debts and legal claims. A corporation is a separate legal entity — it limits your personal liability (subject to exceptions for personal guarantees and director liability), provides tax planning opportunities, and continues to exist independent of you. Most businesses at any meaningful scale are better off incorporated.
You are required to register for and collect GST/HST once your business revenues exceed $30,000 in a single calendar quarter or over the previous four consecutive quarters. Voluntary registration before hitting this threshold can be advantageous — it allows you to claim input tax credits on business purchases. Some supplies are zero-rated or exempt from GST/HST; a lawyer or accountant can advise on whether your products or services qualify.
Review your core legal documents at least once a year and after any significant business change: a new shareholder or partner, a new major client or supplier, a change in your business model, a change in BC or federal law affecting your industry, or a significant increase in the scale of your operations. Many legal problems are caused by documents that were once appropriate but no longer reflect the reality of the business.