Did you know that there were 3.5 million entrepreneurs in Canada in 2020? Do you want to become one yourself?
Owning a Master Business License in Ontario allows business owners to legally operate under a certain business name while also enjoying additional freedoms. Any brands you see advertising on TV, billboards, the internet, or in the newspaper can only do so lawfully in Ontario if they register for this licence.
Eager to learn more about how you can obtain the Master Business License? Read along to find out all about it!
What is a Master Business License in Ontario?
Individuals or companies can conduct business under a name other than their legal name with a Master Business License in Ontario, also known as an MBL, business license, or business registration. This registration is valid for five years and is the most cost-effective way to start a business in Ontario.
What Does The Master Business License Include?
Usually, the licence registration includes the name of the business, its address, the name of the business owner, the business owner’s address, and the business activity.
The registration will also include your Business Identification Number. This nine-digit number is unique to your business registration in Ontario, and you will find the expiration listed at the bottom of the registration.
This date specifies that your registration will expire five years after you apply. Because you are responsible for renewing your registration, it is crucial to note this important date.
There will be no reminders from the government. If you neglect to renew after the expiration date, you have a limited grace period.
Who Can Register a Master Business License?
Most adults can obtain an Ontario Business License due to the registration requirements. You can register for a Master Business Licence in Ontario if you are 18 or older. Unlike incorporation, registration does not require you to be a permanent resident or citizen.
It’s essential to check with Immigration Canada if you’re unsure whether your immigration status qualifies you to apply for a Master Business License in Ontario.
Master Business License Requirements by Business Type
Before applying for a Master Business License, check out the requirements for each business type:
Only a sole proprietor can register a business in Ontario as a sole proprietorship. For new business owners, incorporating as a sole director is another alternative.
In Ontario, two or more people can form a General Partnership. Corporations that want to conduct business jointly can also use the General Partnership.
There is no set percentage of ownership or responsibilities for stakeholders. This is why it’s critical to spell out the specifics of the partnership arrangement, including the functions of each owner and how much of the company they control.
Trade Name registration is only available for existing corporations that have been incorporated or imported into Ontario. They would already have a Business Ontario Corporate number in this case.
Another advantage when registering a Trade Name in Ontario is that it allows you to be more creative with your branding. Under the primary corporate brand, the Trade Name gives you the freedom to manage additional business names. Your corporation has an unlimited number of trade names.
You can apply for a Master Business Licence in several ways:
- Online registration: Registering online is simple and quick, and you can complete it through Ontario’s service portal or a third-party service provider.
- By mail: If you don’t have access to the internet, you can register your business by mail. However, it can take a while longer to register via mail.
- In person: Finally, you can submit your application in person if you live in Ontario. The licence will be mailed to you upon completion.
How to Cancel a Master Business License?
You can amend or cancel your Master Business License after you obtain it. You’ll need to revoke your old permit and re-register if you want to change the name of your business.
You have the option of cancelling your business license online or via mail. If you choose to do this online, you’ll need to go to the Service Ontario website and use the Change of Business Information tool.
Moreover, you must revoke any business license associated with your registered business if you close it. To avoid an audit on your business after the closure, you should notify the Canada Revenue Agency about the cancellation.
How Much Does it Cost to Get a Master Business License in Ontario?
Before registering a business name in Ontario, you should run a NUANS report to determine if someone has previously established a business under your name. This report shows you which other business names or trademarks have been registered that are similar to yours.
Depending on the records you search for, these searches can cost anywhere from $8 to $26. Furthermore, the government charges $60 to register a master business licence online, whereas Service Ontario charges $80 to register in person or by mail.
What Can You Do With a Master Business License?
Numerous perks come with applying for a Master Business License. The most significant benefit would be that you could freely and lawfully operate under a registered business name in Ontario.
This includes the ability to open bank accounts, obtain checks and business cards, and open tax accounts under the business name. Moreover, since you can now get lower prices and can order from wholesalers, you’ll save your company significant amounts of money.
With the Master Business Licence, you can also lawfully advertise and promote your business name on marketing materials, such as billboards, business cards, TV commercials etc.
Overall, when you apply for a Master Business License, you can enjoy plenty of freedom with your brand.
Limitations of a Master Business License
Although the Master Business License can cover the abovementioned features, there are some limitations to it. Here’s what the licence doesn’t cover:
- Name protection against other businesses in Ontario
- Liability protection for the owner
- Corporate tax benefits
- Automatic registration renewals
- Flexibility to make changes after registration is complete
All in all, these are just a few disadvantages that make new business owners consider incorporating their business. So if there’s a chance your business brings a considerable risk of personal liability, think about incorporating instead of obtaining a business license.
Corporations are separate legal entities, meaning any debts or liabilities collected by the company won’t automatically transfer to you.
When starting a new business in Ontario, registering a business is a simple but necessary step. Getting a master business license, whether you’re starting a sole proprietorship or a partnership, ensures that your company has the legal status it needs to operate.
Although obtaining a Master Business Licence is not difficult, not all businesses require one to function. You won’t need to register your name if you plan to use it as a business name. You will need a Master Business Licence to register a business under a different name or trademark.
However, the disadvantage of a Master Business Licence is that it does not protect owners from company responsibilities. If your company is at risk of occurring obligations you want to avoid, becoming a corporation is the best option.
Typically, you won’t need a Master Business Licence if you plan to incorporate your business rather than register as a lone owner. There are, however, several exceptions to this rule worth mentioning. If you wish your corporation to do business under a name other than the corporate name, such as a trade name, you’ll require a Master Business Licence.
A new Ontario Master Business Licence or an Ontario Master Business Licence renewal will set you back $80. When you apply for a new or renewed Master Business Licence, you will receive it in 20 business days.
You can apply for a Master Business Licence in Ontario online, via mail, or in person.