Incorporation is an important decision for any business, large or small:
Our incorporation lawyers can help you with that decision.
Pax Law can assist you with the following:
- Incorporating your company;
- Setting up your initial share structure;
- Drafting shareholder agreements; and
- Structuring your business.
Your Lawyers for Incorporating a BC Company
If you have questions about incorporating your business or are unsure about the process, please reach out to us by scheduling a consultation through our website or by calling our office during our business hours, 9:00 AM – 5:00 PM PDT.
warning: The Information on This Page is Provided to Assist the Reader and Is Not a Replacement for Legal Advice from A Qualified Lawyer.
What is the Process of Incorporating, and Why a Lawyer Can Help You with it:
You will need to obtain Name Reservation
You can incorporate a company as a numbered company, which will have as its name a number assigned by the Registrar of Companies and ending with the word BC LTD.
However, if you intend to have a specific name for your company, you will need to obtain a name reservation from the BC Name Registry.
You will have to choose a three-part name, consisting of:
- a distinctive element;
- a descriptive element; and
- a corporate designation.
| Distinctive Element | Descriptive Elements | Corporate Designation |
| Pax | Law | Corporation |
| Pacific West | Holding | Company |
| Michael Moreson’s | Leatherworks | Inc. |
Why You Need an Appropriate Share Structure
You will need to choose an appropriate share structure with the assistance of your accountant and your legal counsel.
Your accountant will understand how your share structure will affect the taxes you will have to pay and advise your client about the optimal tax structure.
Your lawyer will then create a share structure for your company that incorporates the accountant’s advice while also protecting you and your company’s interests.
The intended share structure will have to take into account the intended business of your company, the expected shareholders, and other relevant factors.
Articles of Incorporation for a BC Company and What They Will Need to Cover
The articles of incorporation are a company’s bylaws. They will lay out the following information:
- rights and responsibilities of shareholders;
- how company’s annual general meetings are held;
- how directors are elected;
- the process for making significant decisions about the company;
- restrictions on what the company can and cannot do; and
- all the other rules that the company will require to function properly.
The province makes general draft articles of incorporation available as the “Table 1 Articles” appended to the Business Corporations Act.
However, a lawyer has to review those articles and make all necessary changes to adapt them to your company’s business.
Using Table 1 articles without review by a lawyer is not recommended by Pax Law.
Incorporating the Company by Filing the Registration Documents
After the above steps are performed, you can incorporate your company by:
- Preparing your incorporation agreement and notice of articles; and
- Filing the notice of articles and incorporation application with the Registrar of Companies.
After you file your documents, you will receive your certificate of incorporation, including your company’s incorporation number.
What Post Incorporation Steps You Will Need to Take:
You Will Need to Prepare Resolutions by Incorporators, Appoint Directors, and Allot Shares
After your company is incorporated, the incorporators named in the incorporation application will need to:
- Allot shares to the shareholders as set out in the incorporation agreement.
- Appoint the company’s directors by resolution.
Based on the Company’s articles of incorporation, the directors or the shareholders may be able to appoint Company officers.
The Company can begin to conduct its business after the Directors and Officers have been appointed. The Company can:
- Delegate tasks to its directors, employees, or officers as required;
- Enter into legal contracts;
- Open bank accounts;
- Borrow money; and
- Purchase property.
You Will Need to Prepare the Company Records or a “Minute Book”
You are required by the Business Corporations Act to keep information such as minutes of the meetings of shareholders and directors, resolutions of shareholders and directors, a register of all shareholders, and various other information in the company’s registered records office. Furthermore, British Columbia law requires each BC Corporation to keep a transparency register of all the significant individuals in the Company at the Company’s registered records office.
If you are confused or unsure about how to prepare your company’s records as required by law and require assistance, the corporate law team at Pax Law can assist you with preparing all the necessary documents, including any resolutions or minutes.
Why Should You Incorporate Your BC Business?
Pay Less Income Tax Upfront
Incorporating your business can have significant tax advantages. Your company will pay its corporate income tax according to the small business income tax rate.
The small business corporate tax rate is lower than the personal income tax rate.
We recommend you speak with a chartered professional accountant (CPA) to understand the tax consequences of incorporation to you and your family.
Manage Your Business
A corporate structure allows multiple entities, such as natural persons, partnerships, or other corporations, to be stakeholders in a business venture and share in the risks and profits of the venture.
By incorporating your business, you can:
- Raise funds by bringing investors into the business and issuing shares to them;
- Raise funds through shareholder loans;
- Bring individuals whose skills you require to run your business into the management of the Company without the risks and headaches of a partnership.
- Appoint directors other than yourself, who are bound by the rules of the Company and required to Act in its best interests.
- Delegate authority to enter into contracts to directors and officers of the Company.
- Hire employees to perform tasks for you without incurring as much personal liability.
Less Liability
A corporation has separate legal personality from its founder, shareholders, or directors.
That means that if the corporation enters into a contract, only the corporation is bound by it and not any of the individuals who own or manage the corporation.
This legal fiction is called “separate corporate personality” and has several advantages:
- It allows individuals to start a business without being afraid that the business failing will lead to their own bankruptcy; and
- Allows individuals to do business without fearing that the business’s liabilities will become their own.
Why Pax Law for your BC Incorporation and Small Business Needs?
Client-centred
We pride ourselves on being client-centred, top-rated, and effective. We will always strive to anticipate our client’s needs and meet them as efficiently and quickly as possible. Our commitment to our clients is reflected in consistent positive client feedback.
Transparent Billing for BC Incorporations
Part of our client-centric approach is ensuring that our clients know what they are retaining us for and how much our services will cost them. We will always discuss fees with you before they are incurred, and we are prepared to provide services to our clients in a fixed-fee format.
Thorough BC Incorporation, Post-Incorporation, Corporate Counsel Legal Service
As a general service law firm, we can assist you and your business from the first step and throughout your journey. When you retain Pax Law, you create a relationship with a firm that will be able to assist you as you need it, when you need it.
If you have questions about the process or consequences of incorporating or want our assistance, reach out to Pax Law today!
Obtain a Name Reservation
You only need to do this step if you want your company to have a name chosen by you. Without a name reservation, your company will have its incorporation number as its name.
Leave a Reply