Starting a Business: How to Choose a Business Name in Canada
Legal & Marketing Aspects of Your New Business's Name Both Matter
When choosing a business name in Canada, there are two things to consider; the name’s marketing potential and its legal elements.
Here’s what you need to know to choose the best possible business name when you’re starting a small business in Canada.
How to Create a Winning Business Name
First, the marketing elements. You want to choose a business name that's memorable but is also going to encapsulate what your business does for marketing purposes. (Restaurants and designers often ignore this rule and pick one word names they hope will engrave themselves in their customers' memories but the rest of us need names that do both of these things.)
Learn how to create a name that’s easy for your customers to remember and good for business promotion too with these two articles:
The Legal Elements of Business Names
If all you had to worry about when you pick a name for your new business was how catchy it was, the job would be so much easier.
But unfortunately, business names must also conform with the law and the legal elements of a business name govern what you can and can’t include in your new Canadian business’s name.
What you can name your business depends greatly on what Form of Business Ownership you choose, referring to the way your business is legally structured.
The three most common forms of business in Canada are:
To learn more about the advantages and disadvantages of each form of business, read Choosing a Form of Business Ownership.
If you choose to structure your new business as a sole proprietorship or partnership, you can’t include words such as Limited, Incorporated or Corporation, or contractions of these words such as Ltd., Inc. or Corp. in your business name, as these are reserved for the use of corporations only.
- (Still pondering which form of business ownership to use? Read 7 Reasons to Incorporate Your Business.)
And Then You'll Have to Register Your Business Name... Maybe
As in Canada, names are regulated by the provinces and territories (except for names relating to federal incorporation), all businesses in Canada must register their business names in their respective provinces or territories except for:
- sole proprietorships that use only the owner’s legal name with no additions. (See Do I Need to Register a Business Name?)
- new sole proprietorships or partnerships in Newfoundland and Labrador. In Newfoundland and Labrador, you do not have to register the name of sole proprietorships or partnerships at all.
In practice, this means that most Canadian business names need to be registered, as not many people give their businesses the identical name to theirs, except professionals (such as writers, financial advisors, consultants, etc.)
For information on how to register a business name in particular Canadian provinces, including how to incorporate in those provinces, see:
Business Registration in Ontario
Business Registration in Quebec
Business Registration in Nova Scotia
Business Names versus Business Numbers
If you choose to incorporate your business, you can create a numbered corporation, rather than actually giving your new corporation a name.
However, in Canada, the term business number refers to the number the Canada Revenue Agency assigns your business as a tax ID.
So you may need a business number even if you don't have to register your business name because of your business's operations.
Anyone with employees, for example, needs a Business Number. What's the Difference Between a Business Name and a Business Number? explains the details.
If your business needs one, here's how to apply for a business number.
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