Canada is a country with one of the strongest economies in the world and this is not something that happened over night. The truth is that thanks to the liberal economy of Canada, this country was able to stay on many top lists for years and decades. Setting up business in Canada is very easy and their judicial system is extremely efficient. Great human resources, low tax rates, favourable business climate, lower business and production cost and well-developed business infrastructure are some of the reasons why people are interested in Canada company formation.
It is good to mention that there are many different corporate structures that people interested in setting up business in Canada can use. Besides the typical trusts, joint ventures and sole proprietorship, most businessperson decide to choose Private Limited Liability companies, public limited liability companies and partnerships. Now let’s see what these companies are and what the advantages of Canada company formation are.
Private LLC is not actually a corporation, but owners will feel more or less the same benefits and protection that come with corporations. Canadian LLC provides excellent flexibility which means that business owners can change the structure of the company fast. In addition, business owners will also get a chance to choose how to be taxed. LLCs have fewer compliance issues, have continuous existence and much more.
On the other hand, public limited companies are companies that have securities which are traded publicly. Canada has stricter laws about this company. The biggest advantage of using this type of company is the fact that you will get a separate legal entity. In other words, the company will continue to exist even is the shareholder/s decide to leave the company or if they die. In addition, you can also raise significant amount of capital.
When it comes to partnerships, they should be registered in the Registry Office and they must be operated by at least two individuals or corporations. It is obvious that the biggest advantage is the increased initial capital. In addition, partnerships provide better flexibility in terms of management. The decision making process is better and the partners share the same responsibility for all the actions they take. There is a great tax advantage because in case the income from this partnership is low or if there is no profit you won’t have to pay taxes.
Starting a Canada non-resident company is very simple and there are cases in which people were able to complete this process on their own. However, those who want to avoid the paperwork and wasting time on visiting certain institutions, can always use the help of a professional company dedicated to Canada company formation. Non residents can open a branch in Canada, but they can also choose to set up a corporation or limited partnership. It is crucial to take the aforementioned advantages of doing business in Canada and the advantages of certain types of companies in order to find out which option suits you the best.