Starting a Business in Quebec
If you’re thinking of starting a business in Quebec, you’re not alone! Here, we’ve rounded up the essential factors to take under consideration for your Canadian business venture!
In this article, we’ll approach the nuances of starting a business in Quebec, a region known for its multiculturalism, bilingualism, and openness. Situated at the crossroads of European and American cultural sensibilities, Quebec could be the perfect province for your nascent business venture. While the population of Quebec lies around 8.2 million, its markets reach around 450 million consumers. And don’t be put off by stories of the Canadian cold; you’ll fall in love with the vivaciousness of spring and summer in cosmopolitan cities like Montréal, and the natural beauty that’s never far away at any time of the year. The cost of living, both urban and otherwise, is also favourable; Montréal and Quebec City in particular remain extremely affordable when compared to hubs like Toronto and Vancouver.
Quebec also benefits from Canada’s participation in the North American Free Trade Agreement, otherwise known as NAFTA. Since 1994, NAFTA has had a positive effect on business in Quebec and Canada more widely by stimulating export markets and widening the reach of Canadian businesses, allowing them to compete on an international scale as well as stimulating foreign investment in the Canadian economy. As a result, business in Quebec is extremely well-connected to American and Mexican markets, and business in Quebec also benefits from its proximity to the United States and particularly New York and the Eastern seaboard. Having stimulated a threefold increase in trilateral trade since its inception, it’s now estimated that around 400,000 people and more than $2.4 billion dollars worth of goods and services cross the border every day.
Read on for information on starting a business in Quebec.
Visas and Immigration
If you aren’t already a Canadian citizen or resident, you’ll need to think about getting a visa before you start your business in Quebec. There are several visa options available to foreign entrepreneurs wishing to start or invest in a business.
- The Start-Up Visa Program: this visa is oriented towards foreign entrepreneurs who would like to start a business in Quebec or Canada that will create jobs in Canada, be internationally competitive, and drive innovation. There are language, resource, and other requirements to be eligible for this visa; you can get particulars on the Canadian government page here.
- The Entrepreneur Program: this visa is oriented towards foreign entrepreneurs with a net capital of at least CAD$300,000 and two years of experience running a business. You can check the other requirements at the Quebec Immigration page here.
- The Investor Program: this visa is oriented towards foreign investors with a net capital of at least CAD$2,000,000 and two years of experience in a farming, commercial or industrial business, an international agency, or with a government department/agency. You can check the other requirements at the Quebec Immigration page here.
- The Self-Employed Worker Program: this visa is oriented towards self-employed individuals with net assets of at least CAD$100,000 and two years of experience in their practice, among other requirements. Check the others here.
Before you think about starting a business in Quebec and registering your business with the province, you’ll need to decide upon which business structure best suits your concept (a sole proprietorship? a limited or general partnership? corporation? non-profit?) and draft a solid business plan outlining your idea and how you plan to make it a reality. A good business plan will cover your growth plan, marketing research and strategy, a 3-5 year forecast, risk assessment, and much more. Don’t forget to check out our free business plan templates available for download to help you draft a bulletproof business plan.
Of course, your business will need a name. If you plan on working as a sole proprietorship, under your own legal name, you are not legally required to register your venture with the province, unless your business sells tobacco products or operates as a tanning salon. However, if you want to sell goods or services under a name that is at all different from your own legal name, you are legally obliged to register your business. Limited or General Partnerships, Limited Liability Companies, Corporations, and Non-Profits that
- have an address in Quebec
- have a telephone line in Quebec
- have a PO box in Quebec
- have a profit-making activity or business in Quebec
are required to register their business with the province.
You’ll also want to be absolutely certain that your business name is not already taken and does not include any problematic terminology. You can check a nation-wide trademark directory for Canada here.
Besides sole proprietorships, associations and cooperatives, joint ventures (undeclared partnerships), and public-good interest groups, all businesses are obligated to register with the Register of Quebec Companies, whose website can be found here. Upon registration you’ll receive a Quebec Enterprise Number (QEN or NEQ in French), making your business identifiable to government agencies. Much of the registration process for your business in Quebec can be completed online on the province’s portal website. You can find fees and methods of payment specific to the structure you’ll be registering here.
You can register your business in Quebec under several different structures.
- Sole Proprietorship: This form of business is owned and operated by a single individual, who assumes full liability for his/her business. Tax-wise, this is a pass-through enterprise, and taxes are paid on the owner’s income.
- General Partnership: A general partnership is made up of two or more individuals who decide to participate in a joint business venture together and contribute knowledge, skills and resources to the undertaking, such as a law or architecture firm. It has a main office and a legal, registered name. It can sue and be sued in a civil action suit.
- Limited Partnership: A limited partnership is made up of two or more individuals who decide to participate in a joint business venture, with one or more general partners (who assume decision-making capacities but also assume full liability for the venture), and limited partners (who do not have significant decision-making capacities but do not assume liability for the venture’s lawsuits or debts). Limited partners’ obligatory contribution to the venture in capital or property, with will be equal to their liability for lawsuits and debts. A LP has a head office and a legal registered name. Find more information on the Register of Quebec Companies website.
- Business Corporation: This form of business is a separate legal entity from its directors and shareholders. It generates a profit that is distributed amongst its shareholders, owns property under its own name, signs contracts through its directors, and can sue and be sued just like an individual. In Quebec, Business Corporations are established under the Business Corporations Act, which can be consulted here. You can also find more information on the Register of Quebec Companies website.
- Non-Profit: A non-profit, like a corporation or a partnership, has a legal registered name and head office, an identity separate from its members, signs contracts through its directors, and can sue and be sued just like an individual. However, because Non-Profits are ostensibly not for profit, they have no share capital and their members are not liable for bankruptcy. You can find more information on the Register of Quebec Companies website.
- Cooperative: A cooperative is a venture made up of members with common needs who join forces to meet those needs. It is automatically registered with the Register of Quebec Companies upon its formation, and its members liability is limited to the value or their shares and/or contributions to the cooperative, and in theory, each member has equal voting and decision-making capacities.
If you’re selling tobacco, fuel, or operating interprovincial or international transportation, keep in mind that you’ll need to obtain special permits from the government.
Any registered business in Quebec must file an annual updating declaration each year after the first year of their activity, even if no changes have been made to the business’ information . If your business information changes after you’ve filed your updating declaration, you’ll have 30 days to update your information on Quebec’s online business portal, My Office.
You’ll likely need to register for GST and QST, or Goods and Services Tax and Quebec Sales Tax. Unless you’re a small supplier, you must apply for QST before you make your first taxable sale in Quebec, and for the GST within 30 days of that sale.If your business in Quebec is going to be making more than $30,000 CAD during the year, you’ll also need to register for GST (Goods and Service Taxes) and QST (Quebec Sales Tax), unless your business is going to be tax-exempt, like a non-profit. Even if you believe you’ll pull in less than $30,000, registering for GST/QST means that you can claim back sales tax that you put into your business, largely reducing your expenses. It does mean that clients will pay sales tax on your goods and services. You can find the appropriate forms here. Keep in mind that you’ll need to pay added taxes on goods and services related to tobacco and alcohol sales, fuel sales, municipal emergency services, and more. Register your business in Quebec with Revenu Quebec, or the Quebec Revenue Agency, here.
Take under close consideration that while Canada is a majority anglophone country, Quebec is a province that is deeply connected to its French roots and politically committed to maintaining French as the province’s predominant language. You’ll rarely be expected to speak French outside of Quebec, but inside this province, things work a little differently. Language will be very important when starting a business in Quebec. While English is important for conducting business both domestically (with other provinces and especially in competing financial centers such as Ontario and British Columbia), most official institutions in Quebec use French as their first language, and it’s important that you or at least one of your close associates has a good working knowledge of Canadian French in order to get your business up and running there.
If you’re on the fence about where to start your business in Quebec, don’t hesitate to check out our sections on starting up in the United States and the United Kingdom, and don’t hesitate to leave suggestions or questions in our comment section. We hope that this article will have you well on your way to starting a business in Quebec!