Basic Accounting info that every business owner should know. When business owners think of accounting, a lot of them get overwhelmed with the thought of complicated calculations, number crunching, tax filings and deadlines. I have prepared this article, covering some frequently asked questions that most start-up, small and medium-sized business owners struggle with getting the answers to.
Q: Can I incorporate a business on my own?
A: A company can be incorporated by an individual, a lawyer or an accountant. Generally speaking, a potential business owner may go through a lawyer to incorporate, if there are many shareholders in the potential business with specific percentages of shares that they will hold. An accountant or accounting firm can also incorporate a business for a potential business owner. But will not have the authority to complete the legalities in specific breakdowns and percentages of ownership. An individual can as well go incorporate on their own as well.
Q: What is the process of incorporating a business in Quebec?
A: The first step to incorporating a business of a potential business owner goes through an accounting firm, is to set a meeting with the person who will be completing the process on their behalf.
In that meeting, two letters of authorization will be prepared and signed, giving the accountant or representative authority to complete the procedures for them.
Here is the info the accountant or representative will need in order to complete the incorporation process:
1. A selection of three business names provided by the client. Also, a numbered company is an option as well, which can be replaced to a name at a later time.
2. Full legal names, addresses and phone numbers of all the shareholders
3. A description of the companies activity and industry
4. The business address that will be used as well as the phone number
Letters of authorization will be signed by the business owner and now the representative or accountant is ready to get the incorporation process started by going to the registre des entreprises on behalf of the clients; where the incorporation process will be completed and a fee of $337.00 will be paid to the RDE to incorporate the business. Once the procedure is completed, the business owner will receive a certificate of the constitution in the mail within 5 to 10 business days, which they will take to their bank to open a business account. It is generally recommended requesting the bank to also provide the new business with a credit card, even if it has a small limit initially so that the business expenditures and activity can be kept separate from the owner’s personal daily life transactions and accounts.
Q: Do I need to obtain GST.QST numbers for my new business?
A: In Quebec, is a company forecasts $30,000 plus of revenue in the business, then it is an obligation to register for sales tax numbers. Most new businesses are not sure what the first year of business will generate, so it is generally hard to determine whether or not they should obtain their sales tax numbers from the get-go. It is recommended, to set the foundation correctly from the beginning of a new business set up; therefore, when an accountant or representative does the incorporation procedures for a client, they will usually apply and obtain the sales tax numbers on their behalf as well.
Q: What is the procedure for obtaining GST.GST numbers in Quebec?
A: If the representative is going to revenue Quebec in person to obtain the sales tax numbers on behalf of the new business owner, then here are the steps they will follow:
1. Have a letter of authorization signed by the business owner, authorizing them to obtain the GST.GST numbers on the business owner’s behalf. The letter will have the date, name of the business as well as the address. It will be clear in writing that the owner of the business is giving authorization to the representative to obtain the sales tax numbers on their behalf for the new legal entity. The letter must be signed by the owner of the business, as revenue Quebec is very strict and follow the procedures by the book and quite thoroughly.
2. An application for GST.GST is then completed by the representative or accountant with the business owner. The businesses NEQ number, name and address are filled in this application, the owner’s name, address, sin number, phone number and signature. How often the business would like to file the GST qst is selected at this time, monthly quarterly or annually. There is a section where the activity of the company needs to be described. The application must be signed and dated by the owner of the business. If there is more than one owner than only one owner needs to sign this application.
3. The representative or accountant will then make a trip with the letter of authorization and the GST qst application to one of the revenue Quebec’s offices. Once there, they will meet with an agent, who will on spot process the request and provide the representative or accountant with the new companies’ gst qst numbers. Which will be active and effective immediately.
4. Within 5 to 10 business days, the owner will receive a formal Letter expressing that the numbers are now active along with a certificate of their GST qst in the mail. A lot of small businesses, such as restaurants and bars, may put up the sales tax numbers for clients to see. Some just file it away with the rest of the incorporation certificates and documents.
We here at 514 Accounting Inc. make the incorporation and obtaining GST.QST numbers for our clients painless!
Please contact us for a Free consultation today!
Source: CBC.ca