Do you have questions about how to start a new business in Toronto? Enterprise Toronto small business advisors can help you get your new business off the ground.

Learn about the process of starting a new business in Toronto with this nine step guide. The federal government's starting a business guide and the provincial government's Small Business Access program can also help you through each step.

Step 1: Conduct Market Research

Step 2: Prepare a Business Plan

A solid business plan is a "roadmap" for your business, it shows where you are going and how you will get there. Writing a business plan helps you understand your capabilities and business needs so you can prepare, focus and set goals – particularly financial goals. If you are applying for financing, a strong business plan demonstrates to lenders that you have done your research and can demonstrate how your financial goals will be met.

The following resources are available to help you complete your business plan:

  • Business Plan Boot Camp – attend our monthly Business Plan Boot Camp session
  • Online Training Resources – use our online training resources to complete your business plan

Enterprise Toronto offers free business plan review and consultation services. The prerequisite requirement for the business plan review is the completion of the Business Plan Boot Camp program. Once you complete the course and prepare your business plan, you can book a one-on-one consultation with our team where we will review your business plan to ensure you started in the right direction.

Book Business Plan Review

Step 3: Create a Marketing Plan

A marketing plan details the strategies that will be used to target and promote your business to potential customers. Enterprise Toronto offers year-round marketing seminars to aid small business owners and entrepreneurs to launch and grow their business.

Marketing plans typically consist of the following sections and information.

Executive Summary: Your executive summary should contain the key points of your marketing plan and, although it is written last, should be positioned at the front of the plan. The executive summary should include highlights from each section, be interesting enough to motivate the reader and be concise.

Market Research: Collect and organize data about the market that is currently buying the product(s) or service(s) you will sell. Some areas you may wish to explore are listed below:

  • market dynamics e.g. seasonal
  • customers – demographics, market segment, target markets, needs, buying decisions
  • product – what's out there now? What's the competition offering?
  • current sales in the industry
  • benchmarks in the industry
  • suppliers – vendors that you will need to rely on

Target Market: Find niche or target markets for your product and describe them.

Product: Describe your product. How does your product relate to the market? What does your market need? What do they currently use? What do they need above and beyond current use?

Competition: Describe your competition and develop your "unique selling proposition". What makes you stand apart from your competition? What is your competition doing about branding?

Mission Statement: Who you are selling to – key market? What you are selling – your company contribution? Your unique selling proposition – what makes your product/service so distinctive?

Market Strategies: Outline the marketing and promotion strategies you plan to use:

  • networking – go where your market is
  • direct marketing – sales letters, brochures, flyers
  • advertising – print media, directories
  • seminars and training programs (to increase awareness)
  • write articles (blog), give advice, become known as an expert
  • direct/personal selling
  • media – publicity/press releases
  • trade shows, events and conferences
  • website and social media.

Pricing, Positioning and Branding: From the information you have collected, establish strategies for determining the price of your product, where your product will be positioned in the market and how you will achieve brand awareness.

Budget: Budget your dollars. What strategies can you afford? What can you do in-house and what do you need to outsource?

Marketing Goals: Establish quantifiable marketing goals. This means goals that you can turn into numbers. For instance, your goals might be to gain at least 30 new clients or to sell ten products per week or to increase your income by 30% this year. Your goals might include sales, profits or customer satisfaction.

By researching your markets, your competition, and determining your unique positioning, you are in a much better position to promote and sell your product or service. By establishing goals for your marketing campaign, you can better understand whether or not your efforts are generating results through ongoing review and evaluation of results.

Continually review the status of your marketing campaign against your set objectives to ensure ongoing improvements to your marketing initiatives and help with future planning.

Step 4: Choose a Business Structure

There are three main business structures: sole proprietorship, partnership (general or limited) and corporation (provincial or federal). Each structure has its own legal and tax implications, and certain advantages and disadvantages. To decide on the structure that best suits the needs of your business, consult the Government of Canada's website.

Step 5: Register Your Business

Businesses that operate under a name other than the owner's, need to register with the Ministry of Government and Consumer Services (Central Production and Verification Services Branch). Business name registrations or renewals can be completed in person or online at the ServiceOntario, or in person at the Enterprise Toronto offices (North York Civic Centre or Scarborough Civic Centre).

Business Name Registration

Sole Proprietorship, General and Limited Partnerships

  • Business registration with the Ministry of Government Services for sole proprietorship and general partnerships is $80 for a paper copy or $60 if completed on the computer terminal. The registration is valid for five years and must be renewed before it expires. Business name searches can be conducted for a fee of $8 to $26 depending on the type of report.
  • Registrations for sole proprietorship and general partnerships can also be completed at Enterprise Toronto. The fee to register your business without a name search report is $114.81, and with a name search is $129.59. Registrations are completed between 9 a.m. and 4 p.m.

Business Incorporation (Provincial/Federal)

Provincial Incorporation

  • Businesses wishing to incorporate provincially must do so through the Ministry of Government and Consumer Services (Government of Ontario). To register as a Provincial Incorporation, businesses need to complete a NUANS name search to determine if the name is available. The NUANS report is omitted for businesses wishing to operate under a numbered company.
  • Articles of Incorporation must be filed within 90 days of completing the name search. The Articles of Incorporation can be filed at the Ministry of Government Services for a cost of $360.
  • Enterprise Toronto offers provincial NUANS name searches for a fee of $74.98 and Articles of Incorporation filing services. Articles of Incorporation filing costs $448.43 (NUANS included in price).

Federal Incorporation

  • Registering under Federal Incorporation provides name rights across Canada, which is important for companies considering the expansion of their business to other provinces or territories.
  • Completion of a NUANS name search is required to federally incorporate a business. The NUANS name search can be completed through Corporations Canada for a fee of $21.47 plus applicable taxes and is valid for 90 days, within which time you must file your Articles of Incorporation. The NUANS name search can also be completed online and processed on the same day or following day for $200 through Corporations Canada by choosing the option "Incorporate a Business".
  • Enterprise Toronto also offers Federal NUANS name searches for a fee of $74.98, and Articles of Incorporation filing services. Articles of Incorporation filing costs $259.89 (NUANS extra if required). Please note, Ontario registration is also required for a total cost of $371.03.

Not-for-Profit Incorporation

When incorporating your not-for-profit business in Ontario, Articles of Incorporation can be filed at the Ministry of Government and Consumer Services (Companies and Personal Property Security Branch).

Steps for incorporating a provincial not-for-profit corporation

  1. Complete a name search called NUANS report. This can be completed at any Enterprise Toronto location for $74.98 (taxes included). This NUANS report is valid for 90 days.
  2. Complete your Articles of Incorporation (Application for Incorporation of a Corporation without Share Capital Form 2 Corporations Act).
  3. Once the NUANS name search and Article of Incorporation are complete you must file them at the Ministry of Government and Consumer Services.
  4. Under the Income Tax Act, not-for-profit corporations should register for a Charitable Number. Registration provides charities with exemption from income tax and also authorizes charities to issue official donation receipts for income tax purposes. T2050 Forms can be downloaded online and submitted to Ottawa for processing. For details please call: 1-800-267-2384.

For additional information, please see the FedDev Ontario Small Business Services Not-for-Profit Guide.

Step 6: Secure Your Financing

Business funds can be obtained from various private financial institutions (e.g. banks and other private lenders) or financing programs. For a list of available funding options, please visit Funding for Small Business.

The following questions can help you to identify the right type of financing for your venture:

  • Where is my business now on its planned growth trajectory?
  • What do I need money for?
  • What financing options are available to me already?

With the answers to these questions in mind, please review the list below and determine where your business fits.

Stage in Corporate Growth Cycle Type of Funding Needed
  • Have a workable idea
  • Have a prototype
  • Have done the research
 Seed financing (from personal resources)
  • Have a few loyal customers
  • Management team ready
  • Business plan completed
 Start-up financing (from friends and family)
  • Have regular paying customers
  • Desire to grow and a large enough market to appeal to an investor
  • Production and Sales need a boost
 Angel financing
  • Ramping up
  • Focus on the break-even point
  • Sales and/or Production and/or Research needs a boost
 Venture Capital financing
  • Strong customer base
  • Steady business flow
  • Need to fund working capital and expand production and markets
 Growth Capital
  • Visionary expansion
  • Desire to achieve exponential growth
  • Past the break-even stage
  • More mature
 Mezzanine / Debt financing
  • Healthy revenue stream
  • Can cover tax payments, payroll and equipment financing
 Traditional banking
  • Desire for public listing (stock exchange)
  • May require interim financing until Initial Public Offering (IPO)
  • Established business with high debt and low equity capital
 Bridge financing, buyout IPO (public market)
  • Need to raise money, awareness and support for your business
  • People who believe in your idea will pledge money in return for a reward if your business succeeds
 Crowdfunding

Step 7: Choose Your Business Location

Municipalities often place zoning restrictions on the location of certain types of business activity. Prior to leasing or purchasing a property, it is advisable to determine that the contemplated business use is permitted on the property. For inquiries about zoning or uses on a specific property, please visit the nearest Toronto Building Customer Service counter for information.

Furthermore, new construction and alterations to buildings often require a building permit. Applications can be obtained through the City of Toronto.

Step 8: Apply for a Business License

You may need a business license to operate a business in Toronto. Use the online business permits and licences service – BizPaL, to search for permits and licences (municipal, provincial and federal) you may need to start or grow your business.

Municipal Licenses

Within the city of Toronto, licenses are required for many types of businesses. Municipal licensing requirements may differ outside the city of Toronto and it is advisable to contact the municipality where you are doing business. In Toronto, operating licenses are issued by the Municipal Licensing and Standards Division of the City of Toronto.

Provincial Licenses

The Business Practices Act requires registration and licensing in many areas such as drug, forestry, motor vehicle, real estate, travel, day-care, liquor sales, gas stations and transportation.

Federal Licenses

A few types of businesses do require federal licensing in order to start a business in Toronto. Use the permits and licences search tool to find out which ones may apply to your business.

Step 9: Determine Tax Requirements

Canada Revenue Agency is the office responsible for taxation issues for individuals and businesses. Canada Revenue Agency issues a Business Number (BN) which is a reference numbering system covering four business accounts:

  1. Business Accounts: Businesses with gross annual sales of $30,000 or more are required to register for Harmonized Sales Tax (HST) and remit it to the Canada Revenue Agency. There is no charge for this application. Businesses that have gross annual revenue of under $30,000 are not required to register for HST, and therefore, do not need to charge their clients the HST tax.
  2. Importer/Exporter Account: Canadian individuals, businesses, non-residents or foreign based importers are required to obtain this number.
  3. Corporate Income Tax: When you incorporate with the Government of Ontario, you will automatically be registered for a business number (BN) and a corporation income tax program account. You should receive your BN number within 45 days of incorporation.
  4. Payroll Deductions: Deductions include Canada Pension Plan (CPP), Unemployment Insurance Contributions (UIC) and Employee Income Tax Deductions.

Canada Revenue Agency also has other useful information on their website that includes individual and business taxation, taxable benefits and allowances, business and professional income, HST registration, payroll and more.

What are Other Things to Consider?

If You Have Employees

If you have employees, you are required to comply with all employment regulations including the Employment Standards Act, the Occupational Health and Safety Act and the Pay Equity Act (for over then employees).

  • Employee Health Tax (EHT)
    • The EHT is a payroll tax applied to all employers in Ontario. Unless exempted, all employers with a permanent establishment in Ontario must register for the EHT. For the first $400,000 of the payroll, eligible private-sector employers are exempt from paying the EHT.
  • Ontario Health Premium
    • Since July 2004, employees in Ontario have paid an additional tax, the Ontario Health Premium. The tax is deducted from pay as part of personal income tax.
  • Workplace Safety and Insurance Board (WSIB)
    • The law requires all businesses in Ontario that employ workers (including family members and sub-contractors) to register with the WSIB within ten days of hiring their first full- or part-time worker.

Import & Export

  • Importer/Exporter Number
    • Canadian individuals, businesses, non-residents or foreign-based importers are required to obtain the importer/exporter number. Online registration is available.
  • Export and Import Controls
    • The Foreign Affairs and International Trade Canada office is responsible for administering the Export and Import Permits Act. The office provides market access and trade policy information, supports the application, approval and processing of import/export permits.
  • Duties, Tariffs, Quotas and Restrictions
    • For general inquiries on duties, tariffs, quotas and restrictions visit Canada Border Services Agency (CBSA) website.
  • Intelligence and Advice on Foreign Markets
    • The Canadian Trade Commission Service provides you with intelligence and advice on foreign markets to help you make better, timely and cost-effective decisions.
  • National Import Services Centre (NISC)
    • Operated by the Canadian Food Inspection Agency (CFIA) in cooperation with the Canada Border Services Agency (CBSA), the Centre processes import requests and documentations, and coordinates inspections for import shipments.
  • Customs and E-Business – Electronic Data Interchange (EDI) System
    • The CBSA commercial importation process including cargo reporting, release, entry and accounting can be done through EDI applications.
  • Export Development Canada (EDC)
    • EDC provides trade financing and risk management services for Canadian exporters.
  • New Substances in Canada
    • Any person who wants to import or manufacture a new substance must contact the New Substances Information Line or visit the Evaluating New Substances website for information to determine if it is a new substance, and how to prepare and submit a notification package.

Health Inspections & Regulations

Food preparation, water and sanitation facilities need to be compliant with the Ministry of Health regulations. To ensure your establishment is in compliance with the Ministry of Health regulations, please contact Toronto Public Health.

Intellectual Property Rights

Canadian Intellectual Property Office offers intellectual property (IP) services and educates business owners on how to use IP more effectively. Intellectual Property includes Trademarks, Patents, Copyright and Industrial Designs.

Ontario Accessibility Laws

The Province of Ontario has action plans and progress reports that will help us make Ontario a more accessible province for people with disabilities. We strongly recommend that you review the accessibility laws and regulations.

Privacy Protection

In Canada, most businesses must comply with the Personal Information Protection and Electronic Documents Act (PIPEDA) which regulates how you may collect, use and disclose the personal information you gather when conducting business. Originally, the Act applied to those private sector organizations regulated by federal laws such as banks, airlines, telecommunications companies, while conducting commercial activities. Now the Act applies also to the retail sector, the publishing industry, the service industry, manufacturers and provincially regulated organizations.

Canadian privacy legislation comprises two federal laws – The Privacy Act and PIPEDA. Provincial legislation includes Freedom of Information and Protection of Privacy Act (FIPPA), Municipal Freedom of Information and Protection of Privacy Act (MFIPPA) and Personal Health Information Protection Act (PHIPA).

Canada's Anti-Spam Legislation (CASL) protects Canadians while ensuring that businesses can continue to compete in the global marketplace. If your business uses electronic means of promoting your business, products and services this may affect you.

The responsibility of business is to limit the use and disclosure and retention of collected information. Business must also obtain consent to collect the information and be responsible for the accuracy of the information.

Insurance

It is always a best practice to contact your insurance broker to confirm that your business and you are adequately protected. For example: if you are a sole proprietorship and working out of your home, you may need additional property insurance.

Guides & Resources

Starting a Food Business

The step-by-step guide will walk you through everything you need in order to start or grow your food business in the city of Toronto.

Guide to Starting a Food Business

Entrepreneurs with Disabilities