Federal vs. Ontario Incorporation

The Big Choice for Small Business

Should you incorporate under the Canada Business Corporations Act (CBCA) or the Ontario Business Corporations Act (OBCA)?

• Federal (CBCA) — Offers Canada-wide name protection and a more prestigious image.
• Ontario (OBCA) — Easier to maintain and slightly lower administrative fees.

Pros and Cons

• Name Protection — Federal provides stronger protection across Canada. Ontario only covers Ontario.
• Filing Fees — Federal is $200 (online). Ontario is $300 (online).
• Annual Filings — Federal requires a $12 annual return. Ontario filings are now done through the Ontario Business Registry.
• Director Residency — Ontario recently abolished the 25% Canadian resident director requirement (the Federal CBCA still has it).

Which One Should You Choose?

• Local Businesses — Ontario is often best for local service businesses or stores.
• Expansion — Federal is better if you plan to expand into other provinces or outside Canada.
• Non-Resident Directors — Ontario is now the top choice for international founders.