Should You Register Your Business Extra-Provincially When Selling Online in Canada?

If you are an e-commerce business owner, it is important to understand the rules and provincial/territorial regulatory requirements your business will need to comply with.

Extra-Provincial Registration

When you incorporated your business, you have a "home province", even if you incorporated federally. If you are doing business with clients or customers that reside outside of your company's home province, you may be required to register your business in the province/territory where your customers are residing. This is called extra-provincial registration. The general rule is that a business is required you to register their federal or provincial corporation in each province and territory in which it conducts business.

What Constitutes “Conducting Business”?

Generally, conducting business typically includes:

1. Having an address, a post office box or a phone number in a province/territory, or

2. Offering services or products in a province or territory.

What Are The Implications If You Don't Register?

Failing to register your business extra-provincially can have serious consequences. An individual who fails to register their business extra-provincially may face a fine of up to $2,000. A business corporation that fails to register could face a fine of up to $25,000.

Are There Tax Implications If You Register Extra-Provincially?

We strongly encourage you to speak with a tax professional/accountant on the tax implications associated with registering your business extra-provincially.