Starting a business in Vancouver: the legal checklist after you pick a structure

Choosing between a sole proprietorship, a partnership and a company is only the first decision. After it come the filings, licences and documents that let you open legally and protect what you are building.

This checklist covers the main BC and City of Vancouver steps, the deadlines that apply, and the documents worth having reviewed before you sign.

1. Register the business name, if you need to

If you are incorporating, our article on when incorporating makes sense in BC covers that route. The steps in this section are for sole proprietorships and general partnerships.

If you are a sole proprietor doing business under your own name only, the Province says you do not need to request a business name or register with it. Otherwise, you first submit a Name Request to BC Registries, then complete the registration before the approved name expires, 56 days after approval. The Partnership Act sets the deadlines:

• Sole proprietors who use a name other than their own, or their own name with words indicating more than one member, must file a registration statement within 3 months after the name is first used (section 88).
• General partnerships carrying on business for trading, manufacturing or mining purposes must file within 3 months after the firm is formed (sections 81 and 82), unless registered as a limited partnership or limited liability partnership.

Registering a proprietorship or partnership does not give you exclusive rights to the name. The Province says only incorporated companies, cooperatives and societies can secure exclusive use of their name.

2. Check the location, then get a City business licence

The City of Vancouver says all businesses in Vancouver require a licence to operate. That includes home-based businesses and out-of-town businesses that carry on business in the city. The licence is the owner's responsibility, not employees'.

Do this before you commit to premises. The City advises checking a proposed location with its Development and Building Services Centre before you lease or buy space, because the Zoning and Development By-law and Building By-law set land use and life safety requirements. A location may be approved, need alterations that require a permit, need an inspection, or not be approved. Depending on the business, there may also be health inspections, police information checks or provincial certificates, and trades and construction businesses may need a Metro West inter-municipal business licence. If you will also operate in another municipality, check its rules too.

3. Open the tax accounts you need

• GST/HST. Most businesses must register once they are no longer a small supplier. Whether you still are one depends on the worldwide taxable sales of all your businesses and those of your associates, and when you stop being one depends on how you pass $30,000. If you pass it in a single calendar quarter, you stop being a small supplier with the sale that takes you over, and you must charge GST/HST on that sale. If you pass it only over four consecutive calendar quarters, you remain a small supplier until the end of the month after the quarter in which you passed it, and you must charge GST/HST from your first taxable sale after that. Either way you then have 29 days to register, but that window does not postpone collecting GST/HST, which applies from that sale onward. Taxi and ride-share operators must register regardless of sales, charities and public service bodies have different thresholds, and small suppliers may register voluntarily.
• BC PST. You generally must register if you are located in BC and sell or lease taxable goods, provide related services such as repairs or installation, or provide software, telecommunication, legal or online marketplace services in BC. A small seller with $10,000 or less in eligible retail sales over the past and next 12 months, and no established commercial premises, may not need to register. The planned expansion of PST to accounting, architectural, engineering, geoscience, non-residential real estate and security services is paused.
• Payroll. If you will pay salaries, wages, tips, bonuses or vacation pay, or provide employee benefits, you need a CRA payroll program account, registered before your first remittance is due.

4. Before you hire: WorkSafeBC and employment standards

WorkSafeBC requires you to register if your business hires one or more workers on a full-time, part-time, casual or contract basis, and recommends applying about four weeks before you start or hire. Some contractors may count as your workers. If you are self-employed with no employees or unregistered subcontractors, you do not need coverage, although you can buy optional personal coverage. If you should be registered and are not, you could be responsible for an injured worker's full claim costs as well as unpaid premiums.

BC's employment standards set minimum requirements for pay, hours of work and overtime, statutory holidays, time off and termination in most workplaces. A written employment agreement that meets those minimums and deals clearly with termination sets expectations from the start.

5. The lease, your contracts and customer data

A commercial lease is often the largest commitment a new business makes. Before signing, have it reviewed for:

• Permitted use that matches what the City will approve for the space.
• Rent and additional rent, including operating costs and property taxes passed through to you.
• Term, renewal and early exit, including what happens if you sell the business.
• Personal guarantees that leave you liable even if you trade through a company.
• Improvements: who pays for them, who owns them, and what must be removed at the end.

Beyond the lease, put key relationships in writing: customer terms, supplier agreements, and contractor agreements that say who owns the work, such as your logo, website or code. If you collect information about customers or employees, BC's Personal Information Protection Act generally applies to private sector organizations that collect, use and disclose the personal information of individuals in BC. The Province says each organization must designate a privacy officer and have a privacy policy available on request.

6. Ownership documents: agree now on how it ends

If you are in business with others, write down how decisions are made, who contributes what, and what happens if someone wants out, dies or can no longer work. For a partnership without an agreement, the Partnership Act's default rules apply: for example, partners share equally in capital and profits and contribute equally to losses (section 27), and each partner is liable jointly with the others for the firm's debts and obligations (section 11).

For a company with more than one owner, a shareholders' agreement does this work. It is also worth checking that your will deals with your business interest.

Opening a business? Set up the foundations before you sign

Our business lawyers can help with name and business registrations, review your commercial lease, prepare customer, supplier and contractor agreements, and draft partnership or shareholders' agreements.

Call 604-259-2844 or send us a message to arrange a consultation at our Vancouver office.