Sole Proprietorship Registration

Registering a sole proprietorship is one of the easiest ways to start a business in Ontario. It means that you and the business are the same legal entity.

Liability

As a sole proprietor, you are personally liable for all debts and obligations of the business. This means that your personal assets (e.g., your home, car) can be seized to pay off business debts.

Business Names

You can operate under your own name or a registered business name. If you use a business name other than your own, you must register it with the Ontario government.

Taxation

The business income of a sole proprietorship is treated as personal income. You will report it on your personal tax return (Form T2125).

Advantages & Disadvantages

• Pros: Easy to set up, low registration fees, and complete control over the business.
• Cons: Unlimited personal liability and limited tax-planning options compared to a corporation.

Next Steps

• Register Your Business Name: Through the Ontario Business Registry.
• Open a Business Bank Account: Keep your personal and business finances separate.
• Apply for an HST Number: Required if your annual gross income exceeds $30,000.