When does a new business need a licence, permit or registration

Except for a few isolated cases, usually involving broadcasting or telecommunications, there is no federal or provincial licensing system for businesses. Occasionally, however, new businesses such as medical colleges are subject to licensing or certification from professional organizations cek live preview.

Municipal licensing

Licensing really only applies municipally. Municipalities issue business licenses to produce revenue and to ensure that licensees comply with zoning requirements.

However, in many cases, such as home-based businesses, business licensing is not enforced. But if your business opens an office or performs functions that will disrupt residential neighbours, it will likely have to do so in a designated area, and will therefore require a municipal business licence.

Environmental and zoning permits

You need a federal and provincial permit for most businesses that affect the physical environment or that work with hazardous materials. All operators of new businesses must understand their area of business well enough to recognize what permits are required.

Some municipalities require zoning and building permits for certain kinds of businesses. Certainly this would be true for any kind of building or construction. You may also need permits for signs and access.

Federal business registration

Businesses earning less than $30,000 annually usually do not have to register for GST/HST and probably don’t need to register with the federal government. However, businesses of a certain size, businesses with employees and businesses engaged in certain activities do have to register with the federal Canada Revenue Agency (CRA) for the following programs:

  • The Goods and Services Tax (GST) or Harmonized Sales Tax (HST)
  • Payroll taxes, such as Canada Pension Plan contributions
  • Corporate income tax
  • Duties for the import or export of goods
  • Registered charity work
  • Excise duties
  • Insurance premium tax
  • Air travelers security charge

To register for any federal government program, a business must first get a Business Number from the CRA.