Starting a business in Canada

The easiest way to move to Canada is experienced, qualified professionals. Business immigration is suitable for those who do not have clear career prospects, but have money and managerial experience.

What is business immigration to Canada

Those arriving will receive the right to stay and conduct business in Canada:

• On migration programs that grant foreign entrepreneurs a permanent residence permit (permanent residency, abbreviated as PR);
• Work permit.

Types of work permit

Work permit is also called "work visa". Permissions are:

• Employer-linked - issued to holders of a valid job offer from a Canadian company that sets the conditions of stay;
• Open - they are allowed to work for any company in Canada.

Recommended company size

Migrants are advised to open micro-enterprises (up to 4 employees) or small businesses (up to 100 employees). 87% companies in Canada employ fewer than 20 people and receive the most government support. Banks approve 85% small business financing applications.

In terms of revenue growth since 2016, the following industries are leading among Russian migrants:

• Building;
• Professional, scientific, technical services;
• Production;
• Warehousing, transportation;
• Software development.

Immigration conditions for entrepreneurs

Work permit is suitable for those wishing to build a company in Canada without going through the lengthy immigration process. The status of a resident or citizen is more difficult to obtain, but it gives the migrant more rights.

Choosing a work permit

You need to apply to the visa center with a signed invitation from the employer, undergo a medical examination and provide other documents.

An open permit does not require an invitation and is issued:

• Spouses or partners of managers working in Canada;
• Foreign students;
• Graduates of Canadian universities, depending on the duration of the study program:

Training, month	Resolution, month
Less than 8	Not issued
8–24	Equal to the duration of training
More than 24	36

PR and citizenship

Federal programs guaranteeing PR to foreign entrepreneurs:

• Immigrant Investor Venture Capital Pilot - for investors, works periodically, requires a fortune from above C $ 10M
• Self-Employed Persons - for self-employed artists, athletes and farmers;
• Start-Up Visa - for startups with written support from a Canadian venture capital fund.

Provincial programs do not guarantee the issuance of a PR upon entry into Canada. First, the migrant receives a work permit, and the province will nominate the foreigner for PR in 1-2 years if the conditions for doing business are met.

Exceptions - Provincial Programs:

• New Brunswick and Nova Scotia for graduates of local universities;
• Prince edward islandif a foreigner owns not less than 33% companies.

Under these programs, the migrant is entitled to PR immediately. Persons with work experience and a valid work permit can apply for an Experience Class permit. The detailed conditions for each province are different.

Average minimum requirements:

• Business experience of at least 3 years;
• Personal fortune 350k - C $ 1.5M, willingness to invest 75 thousand - C $ 1 million;
• The share of a foreigner in the company is not less than 33%;
• Active participation in the affairs of the company;
• Hiring 1-3 Canadian citizens (except for relatives);
• Intention to stay in the province.

The main business income should be active, not passive. Certain programs require the development of a business plan, a business trip before submitting an application, and a license.

Taken into account:

• Applicant's age;
• Language proficiency level;
• Industry;
• Distance from major cities.

Owning a business does not give grounds for obtaining Canadian citizenship - entrepreneurs receive the status on a general basis.

Opening a new or buying a ready-made business

Building a company from scratch is more difficult, so Canadian immigration law imposes additional requirements on company buyers.

Forbidden:

• Buy from persons who owned the business for less than 5 years prior to the sale;
• Buy from ex-migrants who set up a tradable business to migrate to Canada;
• Lay off existing employees.

When buying a company, it is better to use the services of a broker or realtor for commercial real estate. Pay attention to:

• Debts, arrests;
• The number of union members in the state and the benefits provided;
• The need for capital investments;
• Business reputation.

An alternative is to buy a part of an enterprise or a franchise of a well-known company.

Governmental support

The Government of Canada and BDC Bank are developing assistance programs and tools to help small businesses. Among them:

• A test that evaluates a person's business potential;
• Free online calculators of financial indicators;
• Loan up to 50 thousand $ for migrants who moved no more than 3 years ago and own small or medium-sized companies. Does not require personal liability of the applicant.

Business popular among Russian migrants

More than 70% of newcomers start their own business in the local immigrant community. Approximate minimum financial indicators of enterprises popular among Russian migrants:

Directions	Costs, thousand C $	Income, thousand C $	Payback, years
Garage service, car washes	50	20–100	4–6
Retail	30	40 (for a small store)	3–5
Beauty salons, hairdressing salons, SPA	40	30–60	2–4

The size of the initial investment is regulated by the migration program.

Business ideas with minimal investment

Migration programs oblige migrants to hire Canadian citizens. Labor costs are up to 50% the company's budget.

Therefore, you should work where you can get by with 1-2 employees:

• IT consulting;
• Private educational services;
• Fitness training;
• Intra-city transport companies;
• Internet Marketing.

Success story: private kindergarten

Tatiana Osadchaya came to Canada to work as a nanny, but her stay was delayed. After 2 years, she applied for PR and went to study as a Montessori teacher.

In 2007, Tatiana and her husband opened a private kindergarten at home. Less equipment spent 2 thousand C $ (excluding insurance, licenses, promotion costs). The cost of a child's day stay - 60 C $. Full capacity (8 children) scored for 1.5 months.

Legal Aspects

Companies incorporated in Canada are required to have a registered office. Non-residents are prohibited from:

• Trade in securities, real estate;
• Provide legal, financial services;
• Conduct an audit;
• Conduct medical practice.

Forms of ownership

Sole Proprietorship (SP) - a private enterprise with one founding owner, fully responsible for personal property.

Partnership - a partnership of 2 or more owners. This form of ownership is popular among Canadian IT companies, online businesses, and software developers.

Distinguish:

• General partnerships (GP) - the owners share responsibility for the work of the company;
• Limited (LP) - the company is managed by the main partner, who is responsible, and the rights of other partners are limited.

Corporation - a limited liability company registered by the directors making decisions.

Shareholders are not legally responsible. Types of corporations:

• Private - without the right to sell shares;
• Public - freely selling shares.

EPC is an extra-provincial corporation registered without the status of a separate legal entity, licensed to operate in a separate province. EPC can be registered as the main LP partner.

Registration

When registering in Canada, no authorized capital is required, the process is required only for companies with annual income from 30 thousand C $. An SP is not registered if its name is the same as the owner's.

Registration is carried out:

• Online;
• By mail (RC1 form);
• By phone;
• Personal visit.

Business can be registered by residents and persons with a work permit. Process progress:

1. Choosing a company name and checking its availability (paid). Instead of a name, a registration number will do;
2. Obtaining a certificate, a book of minutes, shares.

Registration of corporations is worth 200 C $, SP and partnerships - 80 C $... The place of registration is distinguished:

• Provincial companies with the right to open representative offices only in their own province;
• Federal corporations with the right to establish offices throughout Canada.

25% federal corporations' boards of directors are required to be residents or citizens.

Tax system

Canada has progressive taxation - the rate rises with increasing income. Taxes are levied on net income. Small business in Canada submits reports once a year.

Federal and provincial taxes are levied at the same time. The amount of fees depends on the province, industry, company size. The most lenient rates for small businesses. Limited partnerships are exempt from corporate income tax.

Personal experience

You can live in the service sector if you have unique knowledge and experience. It's harder in trading.

Vladimir Belikov owned a shop selling holiday accessories. In the season I earned at the level of the average salary, in the off-season I only had enough for bread. To make ends meet, the man himself unloaded the goods, washed the floors. It was considered the norm to get up at 5 in the morning, working without days off and vacations.

For 4 years of such slavery, a person burned out, sold the business, and with the proceeds received an education and went to a regular job with a salary, days off and holidays. Now he regrets the lost years.

Canada has tightened business immigration conditions since 2014. Least of all requirements for a business opened by work permit. Programs for graduates of universities in Canada also do not require minimum investment, but training takes a lot of time and money.