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The Ins and Outs of Starting a Small Business in Ontario
Business Planning

The Ins and Outs of Starting a Small Business in Ontario

So, you want to be your own boss? 

Congratulations! Starting a small business is a big achievement. But before you quit your day job and open up shop, there are a few things you need to know about starting a small business in Ontario. 

From incorporating your company to obtaining the proper licenses and permits, there’s a lot to do before you can officially start doing business. 

But don’t worry—we’re here to help. In this blog post, we’ll walk you through everything you need to know about starting a small business in Ontario. 

Incorporating Your Company 

The first step in starting a small business in Ontario is incorporating your company. This will give your business legal status and help protect your personal assets in the event that your business is sued. You can choose to incorporate federally or provincially; each has its own benefits and drawbacks. 

If you opt to incorporate federally, your company will be eligible to do business anywhere in Canada. You’ll also be able to use a enhanced corporate structure, which gives you more flexibility when it comes to raising capital. On the downside, federal incorporation is more expensive and time-consuming than provincial incorporation. 

Provincial incorporation, on the other hand, is less expensive and can be done relatively quickly. And while you’ll be restricted to doing business within Ontario, this may not be an issue if you’re just starting out and haven’t yet expanded beyond the province. 

Obtaining the Proper Licenses and Permits 

Once you’ve incorporated your company, you’ll need to obtain the proper licenses and permits before you can start doing business. The type of license or permit you’ll need depends on the nature of your business. For example, if you’re planning on opening a restaurant, you’ll need a food handler’s certificate in addition to a liquor license (if you plan on serving alcohol). 

You can apply for most licenses and permits online through the ServiceOntario website. 

However, some businesses will require additional approvals from government agencies; for example, if you’re planning on operating a daycare center, you’ll need to obtain a license from the Ministry of Education. 

Registering for Taxes 

All businesses in Canada are required to pay taxes; failure to do so can result in hefty fines or even jail time. Before you start doing business, you’ll need to register for GST/HST and income tax with the Canada Revenue Agency (CRA). You can register online or by mail; depending on the size of your business, you may have to make monthly or quarterly tax payments throughout the year.  

Getting Funding To help Your Small Business

There are a number of government grants and programs available to startups in Ontario. 

The government of Ontario offers a variety of programs and services to help businesses get started, including the Ontario Business Grant, which provides up to $5,000 in funding for eligible startups. The government also offers the StartUP! Program, which provides mentorship and resources for startups. Startups can also apply for government funding through the Small Business Enterprise Centre, which offers a range of government grants and loans. 

To learn more about government funding options in Ontario, be sure to use the Funding Database so you can review hundreds of government grants, government loans and tax options that your small business ion Ontario may be eligible for.

The cost to start a small business in Ontario
Business Planning

The cost to start a small business in Ontario

So you decided to start your own small business and Ontario.  One of the 1st steps is to determine the various start-up costs that you are going to have to cover.

Small business start-up costs vary from business to business.

  • Is your business online, an e-commerce model?
  • Does your business require a physical location?
  • Does your small business provide a service or a product?
  • Do you have staff?
  • Do you have inventory and supplies?

All of these are questions to answer in order to get a better understanding of the various start of costs for your small business in Ontario.

The good thing is that the Ontario government provides a number of government funding programs including government grants, government loans, and various tax breaks to small business owners starting up.

How much does it cost to start a business in Ontario

A typical small business in Ontario will cost between $5000 to $50,000. It can also go as much as a million dollars or more depending on the type of business.

One of the 1st steps to determining your startup costs is to determine your type of business. By answering some of the questions above you will get a better understanding of what type of business you have and the type of expenses you will have to have in order to operate your business.

Different types of startup expenses

When starting a small business in Ontario there are various costs to consider.

1st you have the one-time start up fees.

These startup fees can include the cost associated with registering your business, the initial set up of your website, paying into the marketing, purchasing the needed tools and equipment, covering your rent, and anything else that may be required as an initial capital investment.

The 2nd cost is the operational costs.

These are the ongoing costs that you have to cover usually month to month or at the very least once a year.

These types of costs again can include your rent, your marketing budget, any ongoing supplies, inventory changes, hiring costs, wages, and more.

Understanding your startup costs can make or break your small business.

 If early on you understand that certain costs you will require assistance with, it is a good idea to start considering the support of the local provincial and federal government. The various government grants and loans available can assist you with paying off some of the expenses, especially those initial start-up ones.

Remember, when starting a business, everything that you need to run your business smoothly will be an expense.

While certain expenses you can avoid many will be required to simplify you are starting a process.

Keeping your costs slow is key to success when starting a business in Ontario. However at the same time investing in your business can help it succeed, so don’t shy away from expenses.

Starting an Ontario business for under $5,000

Is it possible?

The costs of every start of business vary on is this very are many factors. You can start a business for under $5,000 however this depends on what your business actually is and the types of small business start-up costs and expenses that you will have.

If you are running an e-commerce style model, your expenses may be very minimal.

Think about, for a new e-commerce model you need your website,  hosting server, few marketing dollars, perhaps a logo, business registration and you just have to have a perfect idea to follow.

While it is recommended to keep costs slow, one of the most important decisions that you have to make is knowing if you will have enough money to cover the expenses to run the business that you want to run. If you plan on starting up with no money don’t do it.

A successful business will require an investment. That investment, be it from your own funds, borrowed from the bank, private investors, or government agencies, will be required to help you succeed in achieving your goals.

So what is the cost to start a small business in Ontario.

Depending on the type of business you want to start your costs will vary. It is recommended to get into business only when you have a certain amount of money that can cover various costs. At least for the very crucial costs. For the rest, try government funding as a way of paying off your expenses at least within the initial year.

To know more about the various costs associated with starting a small business speak to one Ontario Startups expert.

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