Canada

Company Formation in Canada (Federal)

Government of Canada — Corporations Canada (CBCA)

Formation Time

1–2 business days

Min. Capital

No minimum

Corporate Tax

15% net federal (9% small business CCPC rate; provincial tax applies)

Foreign Ownership

100%

Overview

Federal incorporation in Canada under the Canada Business Corporations Act (CBCA) is the gold standard for businesses seeking national brand protection and international prestige. Supervised by Corporations Canada, a federal charter grants the corporation the constitutional right to carry on business under its corporate name anywhere across Canada's ten provinces and three territories, providing nationwide name exclusivity that provincial incorporations cannot offer. In 2024, Canada enacted Bill C-42, introducing a public register of Individuals with Significant Control (ISCs) to enhance corporate transparency and satisfy international FATF anti-money laundering standards. Canada levies a competitive net federal corporate income tax rate of 15% (which drops to just 9% for Canadian-Controlled Private Corporations under the Small Business Deduction on the first $500,000 of active business income). While CBCA historically required 25% of directors to be resident Canadians, federal corporations registered in provinces with no residency requirements (such as British Columbia, Ontario, or Alberta) enjoy straightforward operational structures. With 94 comprehensive double taxation treaties, access to CUSMA/USMCA (NAFTA 2.0) duty-free North American trade, and a banking sector ranked among the soundest in the world, Canada is the premier sovereign alternative to US incorporation.

Nationwide name protection

15% net federal CIT

CUSMA/USMCA access

94 tax treaties

SR&ED 35% R&D cash refunds

Why Choose Canada (Federal)

Nationwide name protection — unique legal right to operate under your corporate name across all 10 provinces

Net federal corporate income tax of 15% (9% small business rate for CCPCs)

Direct tariff-free market access to the US and Mexico under CUSMA/USMCA

Extensive network of 94 bilateral Double Tax Agreements (DTAs) globally

Canada's 'Big Six' banking institutions are globally ranked for capital safety and stability

Canada Start-up Visa and Intra-Company Transferee (ICT) work permit pathways for founders

Low $20 CAD Corporations Canada annual return filing fee

Complete remote incorporation and corporate banking onboarding supported

Business Entity Types

Entity	Ownership	Directors	Capital	Tax	Best For
Federal Corporation	100%	1	None	15% net federal CIT + provincial CIT (9% federal CCPC small business rate)	International expansion, cross-border US-Canada trade, tech startups, venture capital
Extra-Provincial Corporation	100%	1	None	Taxed on Canadian-source income allocated to operating province	Foreign corporations (US, UK, UAE) establishing Canadian commercial branch operations

Step-by-Step Formation Process

Federal NUANS Name Search

1 day

Perform pre-search and generate official federal NUANS reservation report.

Filing Articles of Incorporation

1–2 business days

File Form 1 Articles of Incorporation electronically with Corporations Canada.

CRA Business Number (BN) Issuance

1–3 business days

Obtain 9-digit Business Number and Corporate Income Tax (RC) account from Canada Revenue Agency.

Bill C-42 ISC Register Filing

1–2 days

Record and submit beneficial ownership details for individuals holding 25%+ voting shares.

Extra-Provincial Registration & Banking

3–7 business days

Costs & Fees

Government / License Fee	CAD 200+
Our Service Fee	USD 1,200 – 2,800
Annual Renewal	CAD 20+

Fees are indicative and may vary based on business activity, entity type, and additional approvals required. Contact us for a precise custom quote.

Get Custom Quote

Banking

Canada's banking system is renowned for solvency and conservatism. The 'Big Six' banks (RBC, TD, Scotiabank, BMO, CIBC, National Bank) provide multi-currency CAD/USD accounts with direct access to US ACH and Canadian Interac/EFT systems.

Account Opening Time

1–2 weeks

Multi-Currency

Yes — multiple currencies supported

Recommended Banks

Royal Bank of Canada (RBC)TD Canada TrustBMO Bank of MontrealScotiabankWise Business Canada

Tax Overview

Corporate Tax

15% net federal CIT (9% small business CCPC rate on first $500k) + provincial rate (8% to 16%)

Personal Income Tax

15%–33% federal graduated rates (plus provincial personal tax)

VAT / Sales Tax

5% federal GST (or 13%–15% HST in participating provinces)

Capital Gains Tax

50% inclusion rate (or 66.7% inclusion on capital gains over $250k under updated tax rules)

Withholding Tax

25% statutory non-resident withholding (reduced to 5%–15% under tax treaties)

Double Tax Treaties

94 countries

Canada offers the Scientific Research and Experimental Development (SR&ED) tax incentive program, one of the most generous R&D tax credits in the world, providing cash refunds of up to 35% on qualifying research expenditures.

Frequently Asked Questions

What is the difference between Federal and Provincial incorporation in Canada?

Federal incorporation under the CBCA protects your corporate name across all 10 provinces and 3 territories, granting national exclusivity. Provincial incorporation only protects your name within the specific province of incorporation. If you intend to operate across multiple provinces or internationally, federal incorporation is the standard choice.

What is the Bill C-42 Beneficial Ownership Register in Canada?

Bill C-42 amended the CBCA in January 2024 to make Canada's register of Individuals with Significant Control (ISCs) publicly searchable on Corporations Canada's database. An ISC is any individual who holds 25%+ of voting shares or exercises significant direct or indirect influence over the corporation.

Can a foreign non-resident own 100% of a Canadian federal corporation?

Yes. Non-resident individuals and foreign corporations can own 100% of the voting shares of a Canadian federal corporation. Foreign investors can also take advantage of Canada's extensive 94-country double tax treaty network.

What is the Small Business Deduction (SBD) in Canada?

The Small Business Deduction reduces the federal corporate tax rate from 15% to 9% on active business income up to $500,000. However, this preferential rate is only available to Canadian-Controlled Private Corporations (CCPCs), meaning foreign-controlled corporations pay the standard combined general rate (approx. 23%–27% depending on the province).

What is the SR&ED tax incentive program?

The Scientific Research and Experimental Development (SR&ED) program provides federal and provincial tax credits of up to 35% on eligible R&D expenditures (salaries, materials, overhead). For qualifying Canadian tech startups, these credits can be paid out as direct cash refunds, making Canada a leading global R&D hub.

Can I open a Canadian corporate bank account remotely?

Yes. Incorp International assists foreign founders in establishing CAD and USD multi-currency commercial accounts with major Canadian institutions and business fintech partners without mandatory Canadian travel.