Last reviewed October 7, 2026 · By the NYBACS advisory team
Short answer
Yes — foreign individuals and companies can own 100% of a Canadian corporation, but the choice between federal and provincial incorporation matters. A federal corporation under the Canada Business Corporations Act must still have at least 25% resident Canadian directors (at least one if it has fewer than four), while Ontario, British Columbia and Alberta have removed director residency rules. Incorporation is followed by a CRA Business Number, GST/HST and an Investment Canada Act notification.
Key takeaways
- You can incorporate federally with Corporations Canada or provincially (for example in Ontario, British Columbia or Alberta); either way, the corporation must register extra-provincially wherever it carries on business.
- Federal (CBCA) corporations must have at least 25% resident Canadian directors, or at least one if they have fewer than four directors; several provinces impose no director residency requirement.
- Federal corporations must file information on individuals with significant control (ISC) with Corporations Canada annually and within 15 days of changes.
- A non-Canadian establishing a new Canadian business generally files an Investment Canada Act notification no later than 30 days after implementation.
- GST/HST registration is required once taxable supplies exceed the small-supplier threshold, and provincial sales tax may also apply.
Canada at a glance
| Common entity for foreign owners | Federal (CBCA) or provincial business corporation; extra-provincial branch as an alternative |
|---|---|
| Company registry | Corporations Canada (federal) or the provincial registry, e.g., Ontario Business Registry, BC Registries |
| Foreign ownership | 100% generally permitted; Investment Canada Act notification for new businesses; some sectors restricted |
| Local director / resident requirement | Federal: 25% resident Canadian directors (one if fewer than four). None in Ontario, BC or Alberta |
| Registered office | Street address in the province named in the articles |
| Key tax registrations | CRA Business Number; corporate income tax, GST/HST and payroll accounts; provincial sales tax where applicable |
| Recurring compliance | T2 return, annual return, ISC filings (federal), extra-provincial renewals, minute book upkeep |
| Typical setup timeline (indicative) | Online incorporation often within days once the name is cleared; banking timing depends on signing-officer attendance |
Indicative only. Rules, filings, fees, ownership restrictions and timelines vary and change — confirm the current position before acting.
Federal or provincial corporation: which suits a foreign owner?
Canada has 14 corporate statutes — one federal and one for each province and territory. Both federal and provincial corporations have limited liability and can be wholly foreign-owned.
| Federal (CBCA) | Provincial (e.g., Ontario, BC, Alberta) | |
|---|---|---|
| Registry | Corporations Canada | Provincial registry (Ontario Business Registry, BC Registries, Alberta Corporate Registry) |
| Name protection | Canada-wide name review, usually with a NUANS report | Within the province |
| Director residency | At least 25% resident Canadians (one if fewer than four directors) | None in Ontario, BC or Alberta; varies elsewhere |
| Operating elsewhere | Must still register extra-provincially in provinces where it carries on business | Must register extra-provincially in other provinces |
For a foreign owner with no Canadian director, a provincial corporation in a province without residency rules is usually the practical choice. A federal corporation suits groups that want national name protection and already have a Canadian-resident director. A foreign company can also register as an extra-provincial branch, but most prefer a subsidiary.
Step-by-step: incorporating in Canada from abroad
- Choose the jurisdiction — federal or a specific province — based on director residency, where you will operate and name protection needs.
- Clear the name with a NUANS search report (required for federal and Ontario named corporations), or incorporate as a numbered company.
- Prepare the articles of incorporation: share classes, restrictions on share transfers, number of directors and registered office province.
- File online with Corporations Canada or the provincial registry, with the initial registered office address and director details.
- Adopt by-laws, issue shares and set up the minute book and securities register.
- Set up the ISC register and, for federal corporations, file ISC information with Corporations Canada.
- Obtain the CRA Business Number — often issued at incorporation for federal and many provincial filings — and add program accounts for corporate income tax, GST/HST and payroll as needed.
- Register extra-provincially where the business will operate, and file the Investment Canada Act notification within 30 days of establishing the new business.
Documents from individual and corporate shareholders
Canadian registries ask for little documentation at filing, but lawyers, banks and the CRA apply due diligence afterward.
- Individuals: passport, residential address and, for any director counted toward a residency requirement, evidence of Canadian citizenship or permanent residence and ordinary residence in Canada.
- Corporate shareholders: certificate of incorporation or good standing, articles, a register of directors and officers, and a resolution approving the subscription and naming signing officers.
- ISC information: name, date of birth, residential address, citizenship, tax residence and the nature of control for each individual with significant control — including those behind a corporate parent.
Banks may ask for notarized or apostilled copies of parent documents and certified translations of anything not in English or French.
Tax registrations and ongoing compliance
- Corporate income tax: Canadian corporations file a T2 return within six months of year-end; federal and provincial taxes combine, and Canadian-controlled small business rates do not apply to foreign-controlled corporations.
- GST/HST: registration is required once taxable supplies exceed the small-supplier threshold (C$30,000 over four consecutive calendar quarters) and is voluntary earlier. British Columbia, Saskatchewan, Manitoba and Québec also have provincial sales taxes with separate registration.
- Payroll: a payroll program account before the first payment to employees.
- Withholding: dividends and certain payments to non-resident shareholders attract Part XIII withholding, reduced under applicable tax treaties.
Annual corporate filings include the annual return to Corporations Canada (within 60 days after the anniversary date) or the provincial equivalent, ISC updates, and the corporation's minute book and resolutions.
Banking and KYC for a foreign-owned Canadian corporation
Canadian banks generally open accounts for foreign-owned corporations but apply strict identity verification to directors, signing officers and beneficial owners. Many still prefer or require at least one signing officer to attend a branch, and they will want the articles, by-laws or resolutions naming signing authority, the ISC register and a description of expected cross-border flows. Onboarding times vary; starting the conversation with the bank before incorporating avoids surprises about who must attend and which documents they will accept.
Is Canada the right destination for your business?
Canada suits businesses targeting Canadian customers or talent, groups that want a North American presence with strong public-sector and enterprise credibility, and companies using Canada's free trade agreements. The friction points are multi-jurisdiction registrations and, for federal corporations, the resident director rule.
Compared with the United States, Canada is a smaller market, but its sales tax system is more centralized: GST/HST is administered by the CRA across the country, rather than registered state by state, with separate provincial sales tax in only a few provinces. Many groups form a US entity first for market size, then add a Canadian corporation when they hire or sign Canadian customers.
Common mistakes to avoid
- Incorporating federally without a resident Canadian director, then being unable to complete the board.
- Assuming a federal corporation does not need provincial extra-provincial registration where it operates.
- Missing the Investment Canada Act notification after establishing a new Canadian business.
- Not mapping individuals with significant control behind a foreign parent company.
- Expecting Canadian small business tax rates for a foreign-controlled corporation.
- Forgetting provincial sales tax registration in provinces that levy it separately from GST/HST.
Documents and records to prepare
- NUANS name search report (if using a named corporation in a jurisdiction that requires it)
- Articles of incorporation and registered office address in the chosen province
- Passport and residential address of each director and individual with significant control
- Evidence of Canadian residency for any director counted toward a residency requirement
- For a corporate shareholder: certificate of incorporation, articles, register of directors and a subscription resolution
- By-laws, share subscription documents and initial resolutions for the minute book
NYBACS 360° support
How NYBACS helps
- Compares federal and provincial incorporation against your director residency, operating provinces and name-protection needs.
- Coordinates incorporation, minute book, ISC register and extra-provincial registrations through Canadian partners.
- Plans the CRA Business Number, GST/HST, provincial sales tax and payroll accounts around your launch timeline.
- Prepares the bank KYC pack and flags the Investment Canada Act notification and annual return deadlines.
Frequently Asked Questions
Do I need a Canadian director?
For a federal CBCA corporation, yes: at least 25% of directors, or one director if there are fewer than four, must be resident Canadians. Ontario, British Columbia and Alberta corporations have no director residency requirement.
Can a non-resident be the only shareholder?
Yes. Canadian corporate law does not restrict foreign share ownership in general, although some regulated sectors have Canadian ownership or control requirements.
Is the Investment Canada Act notification an approval?
For most new businesses it is a notification filed after the investment, not an approval. The government can, however, review investments on national security grounds, and some sectors trigger additional review.
Does incorporating in Canada allow me to work there?
No. Owning a Canadian corporation does not confer a work permit or residency. Immigration routes are separate and handled by licensed immigration professionals.
What is the registered office requirement?
The corporation must keep a registered office in the province named in its articles. Federal corporations name the province in their articles and file the street address with Corporations Canada.
