How to Start a Business in Quebec

Starting a small business is no easy feat, but preparing yourself with the necessary information can help make it much less intimidating. From choosing a business structure to applying for GST and QST numbers, here is how to start a business in Quebec for new, and experienced, entrepreneurs. Is Quebec a good place to start a business? As the second most populous province in Canada, there is also a good amount of opportunity for entrepreneurs within the province. And of course, if French is your native language, Quebec is an ideal location to do business. Read on for some additional benefits unique to businesses operating in Quebec. Benefits of starting a business in Quebec French language: According to Statistics Canada, nearly 86% of the population of Quebec speaks French on a regular basis. As such, French speakers can benefit from opening their enterprises in Quebec. Under the Charter of the French language, it is the official language for business in the province. GDP per capita: In 2021, Quebec had the fourth strongest GDP per capita of Canada’s provinces, according to Statistics Canada. Highly-specialized manufacturing: Manufacturing is the largest sector contributing to the province’s overall GDP. The majority of manufacturing enterprises within the province are small to medium businesses (SMB) that are highly specialized and innovative. Diverse industries: The province has diverse industries. From Agri-food, mining and forestry to information and communication technologies (ICT), multimedia and gaming and aerospace, the province has opportunities in varying sectors. Government grants and subsidies: The government and Revenu Quebec offer grants and subsidies for businesses, particularly in the arts and culture industry. Tax benefits: Small and medium businesses in Quebec are eligible for certain small business tax deductions (SBD) from Revenu Quebec and subsidies from the government of Quebec to help support the growth of businesses in the province. Cost of starting a business in Quebec The costs for starting up a business in Quebec will depend on the business structure you’ve chosen for your enterprise. Below are the basic registration fees for Quebec's most common types of enterprises. Sole proprietorship: Registering your business as a sole proprietorship will cost $38 CAD for a declaration of registration if you’re registering yourself. Federal incorporation: In Quebec, federal incorporation starts at $200 CAD, plus a $35 CAD fee for a NUANS name search report if filing yourself. Provincial incorporation: The fee to incorporate provincially under the Business Corporations Act in Quebec is $367 CAD. Remember, if registering your business yourself, you may incur additional legal fees for submitting government filings. You’ll also need to consider the capital needed to successfully launch your business, whether that be equipment, inventory or marketing materials. Cost of starting a business in Quebec with Ownr Sole Proprietorship Registration with Ownr: Ownr recently dropped the fee for Sole Proprietorship registration to just $49 (including government filing fees), making it an even more affordable option for entrepreneurs starting up their businesses. Plus, if you open an RBC business bank account within 60 days, you’ll receive a $100 refund. Get started registering your Sole Proprietorship. Provincial Incorporation with Ownr: Quebec Incorporation Packages start from $699 for provincial. What’s more is if you open an RBC business bank account within 60 days, you can get up to $300 refunded. Learn more about Incorporation Package pricing and packages. How to start a business in Quebec It’s important to understand the rules and regulations for operating your specific business within Quebec as there are different legal requirements based on the sector of your business, the type of business structure, and if you choose to incorporate provincially or federally. Setting up your business Determine the type of business you want to start Before you can register and begin operations, you’ll need to determine the best business structure for your enterprise. This business structure (also sometimes referred to as the legal form) will determine how you can carry on business in Quebec. Sole proprietorship: An enterprise that is owned and operated by a single person. A sole proprietorship has no legal distinction from the owner, so the owner is legally responsible for all profits and losses. Most self-employed workers operate this form of enterprise. Learn more about registering your business as a sole proprietorship in Quebec here. Corporation: A common business structure, incorporating means that a distinct legal entity operates the enterprise, which offers limited liability for shareholders and a lifespan that exists beyond them. Incorporating allows additional flexibility including the ability to issue shares to raise capital, as well as tax advantages. If you’re considering a corporation, explore everything you need to know about incorporating in Quebec. Other business structures: Some additional business structures that are less common for entrepreneurs operating their own enterprises are co-operatives, joint ventures, associations and non-profit organizations. As an entrepreneur operating a small business, you’ll be most likely to choose a sole proprietorship or corporation. Unsure which one is the right choice for your business plans? Here’s how to choose whether a sole proprietorship or corporation is right for you. Choose between provincial or federal incorporation If you choose to incorporate your business, it’s important to determine the regions where you will do business, in the province of Quebec or across Canada. Federally incorporated enterprises will have name protection across the nation and can have their head office anywhere in Canada (however, if the business operates in Quebec without establishments, they will require an attorney in Quebec in most cases). Provincially incorporated enterprises are granted name protection within the province and must have their head office in Quebec. Despite this, there are some significant benefits to incorporating provincially in Quebec, like faster turnaround time, fewer requirements for shareholder payouts, and relaxed rules on the citizenship requirements for the board of directors. Learn more about the benefits of incorporating either federally or provincially in Quebec. Create a business plan Creating a well-thought-out business plan will set you up for success as an entrepreneur. It creates a framework that you can always look to when making decisions related to your business. Your business plan should include: Operational details Financial projections for your business A marketing strategy Any additional information that you want to share with investors Finding tackling a business plan intimidating? Check out the best business plan templates for 2022 that break it down into easily digestible steps. Choose your business name Before registering your business, you need to determine an appropriate and compliant business name for your enterprise. In most cases, the enterprise will have a name that is: A unique business name that contains a generic, specific, and, if applicable, a particle component An automatically assigned numeric designation, plus “Quebec Inc.” In order to comply with the Charter of the French Language, your enterprise’s name must usually be in French. The full list of the requirements for an enterprise name in Quebec can be found on the Registraire des enterprises website. Note: For federal incorporation, you may also need a NUANS name search report to determine that your chosen name meets the designated criteria. Now that you’ve chosen a business structure and enterprise name and created your business plan, you’re ready to officially register your Quebec small business! Register your business Most enterprises are required to submit a declaration of registration or an initial declaration (within 60 days of the time of constitution). The forms are available through the REQ portal exclusively in French. After doing so, you will automatically be assigned an NEQ number (a business identification number specific to enterprises in Quebec). What types of businesses are required to register in Quebec? Sole proprietorship: Sole proprietorships operating under a name other than the first and last name of the sole proprietor or those operating a retail tobacco business are required to register. To register your sole proprietorship, you must submit a declaration of registration with the Démarrer une entreprise service. Provincial incorporation: To incorporate under the Quebec Business Corporations Act, you will need to submit your articles of constitution and initial declaration, along with a Declaration relative to the name, and a List of the first directors of the Corporation. Federal incorporation: To incorporate under the Canada Business Corporations Act, you will need to submit your articles of constitution, initial declaration and register with the Registraire du Quebec. Tax implications As a small business owner, you’ll have bookkeeping responsibilities to ensure that your enterprise’s taxes are in order. In Quebec, there is no harmonized sales tax, so business owners will need to register for the provincial sales tax, QST, as well as GST. This can be done through Revenu Quebec. An exception to this is if your total worldwide income does not exceed $30,000 in one calendar year, or over four consecutive calendar quarters. This exception excludes certain sectors like taxi businesses for GST and QST and fuel, tobacco, alcoholic, tire or vehicle businesses for QST. You can learn more about registering for GST and QST at the Revenu Quebec website. Depending on the activities of your business, it may also be necessary to register to additional CRA accounts and Revenu Quebec programs. Managing your business' success Once you’ve successfully started your business in Quebec, ensure that you complete any other documentation required for your business operations. This might include: Business licenses Business insurance Other legal documents for business compliance (vendor agreements, partnership agreements, non-disclosure agreements) BizPal is a free government license and permits resource that can assist in determining the necessary documentation that your business needs, and when you will need them. How to start a business in Quebec FAQs 1. How long does it take to register a business in Quebec? Depending on the business structure you choose, it may take as little as one business day to complete registration for a sole proprietorship or incorporation once the appropriate application is submitted, if all is in order and there are no issues with the chosen business name. 2. How do I get a Quebec business number? A Quebec business number is an essential step for any enterprise doing business within the province. Fortunately, it is easy to get an NEQ number in Quebec. An NEQ is assigned automatically by the REQ upon registration. For enterprises that do not need to submit a declaration of registration (like corporations that are registered provincially), the NEQ number will be automatically assigned at the time of constitution. 3. Do I need to register my business in Quebec? In most cases, an enterprise is required to register with the Registraire des enterprises. The main exception is a sole proprietorship that operated under your exact first and last name. Certain exceptions based on the activities of your business may apply (for example, operating a tobacco retail business or providing artificial tanning services). You may still choose to register your business on a voluntary basis even if not required.