If you are a newcomer planning to start a company in Canada, the core finance setup is straightforward: you can incorporate federally or provincially (Alberta and British Columbia have no director-residency rule), you open a corporate bank account once the company is registered, you get a Business Number from the Canada Revenue Agency (CRA), and you only register for GST/HST once your taxable revenue passes $30,000. Layered on top is your personal tax residency, which determines how your worldwide income is taxed. This guide walks through each step in the order a founder actually encounters them, with Alberta as the primary example.
Step 1 — Decide federal vs. provincial incorporation
Your first structural choice is whether to incorporate federally (under the Canada Business Corporations Act) or provincially (for example, under the Alberta Business Corporations Act).
For many newcomers, the deciding factor is the director-residency requirement:
| Jurisdiction | Director residency rule | Typical fit for newcomers |
|---|---|---|
| Federal (CBCA) | At least 25% of directors must be resident Canadians (or one, if fewer than four directors) | Better if you operate nationally and have a resident co-director |
| Alberta (ABCA) | No Canadian-residency requirement for directors | Strong fit for a solo newcomer founder |
| British Columbia (BCA) | No Canadian-residency requirement for directors | Strong fit for a newcomer founder based in BC |
If you are a sole founder who has just arrived and do not yet have a Canadian co-director, provincial incorporation in Alberta or BC is usually the path of least resistance. Federal incorporation gives you nationwide name protection but adds the residency rule and a separate extra-provincial registration in each province where you carry on business.
Name and registry mechanics
In Alberta, incorporation is filed through an authorized registry agent, and you will typically order a NUANS name-search report to clear your proposed corporate name (or choose a numbered company). Keep your articles of incorporation, the certificate of incorporation, and your registry confirmation — you need them for banking and CRA setup.
Step 2 — Get your Business Number and CRA program accounts
The Business Number (BN) is the 9-digit identifier the CRA uses for your corporation. Everything else hangs off it:
- RC — corporate income tax (T2)
- RT — GST/HST
- RP — payroll
- RM — import/export, if you ship goods across the border
Federal incorporation usually generates the BN automatically. If you incorporate provincially in Alberta, you register for the BN with the CRA after incorporation. You add each program account (RT, RP, etc.) only when you actually need it — there is no benefit to opening a payroll account before your first hire.
As an Alberta corporation you will file a federal T2 corporate return and a separate Alberta AT1 provincial return. Alberta's combined small-business corporate rate is roughly 11% on active business income within the $500,000 small-business limit (9% federal + 2% Alberta, as of the 2026 tax year), one of the most competitive in the country and a frequent draw for newcomer founders. For the full picture, see our Alberta corporate tax guide.
Step 3 — Open a Canadian bank account
Banking is sequential: most newcomers open a personal account first (newcomer banking packages exist precisely for this), then a corporate account once the company exists.
To open a business account you will generally need:
- Articles and certificate of incorporation
- Your Business Number
- Government photo ID (passport is widely accepted)
- Proof of a Canadian address
- Details of the directors and signing officers
Keep business and personal money strictly separate from day one. Commingling funds is the single most common bookkeeping problem we see in early-stage companies, and it is far harder to untangle a year later than to avoid at the start.
Step 4 — Understand your tax residency
Your personal tax residency is separate from where your company is incorporated, and it drives how your own income is taxed.
As of the 2026 tax year, the CRA looks first at significant residential ties:
- A home available for your use in Canada
- A spouse or common-law partner living in Canada
- Dependent children living in Canada
If you establish these ties, you are generally a factual resident from that date, and your worldwide income becomes taxable in Canada for the resident portion of the year. The CRA treats your first year here as your newcomer year, and you typically file your first Canadian return in the spring following the year you arrived.
Income earned before you became a resident is usually outside the Canadian tax net, and Canada's network of tax treaties plus the foreign tax credit generally prevents the same income from being taxed twice. Cross-border facts (foreign property over $100,000, foreign corporations you control, prior-country pensions) get specific quickly, so this is the area most worth a professional check.
Step 5 — Set up bookkeeping and GST/HST correctly
You do not register for GST/HST on day one. As of the 2026 tax year, you must register once your worldwide taxable revenue exceeds $30,000 over four consecutive calendar quarters, or in a single quarter. Below that you are a small supplier and registration is voluntary.
Registering voluntarily can still make sense if you have large startup costs, because GST/HST registration lets you claim input tax credits (ITCs) on the GST you pay. New registrations are now completed online through the CRA's Business Registration Online portal. For mechanics across provinces — Alberta has no PST, while BC adds a 7% PST — see our startup finance guide.
Newcomer founder setup checklist
- Choose federal vs. Alberta/BC provincial incorporation (mind the director-residency rule)
- Clear your name (NUANS) or take a numbered company
- File incorporation and store your articles/certificate
- Obtain your Business Number from the CRA
- Open a separate corporate bank account
- Set up cloud bookkeeping and keep personal money out
- Confirm your personal tax-residency start date
- Register for GST/HST only when you cross $30,000 (or voluntarily for ITCs)
- Add a payroll (RP) account before your first paycheque
How RN Canada helps
RN Canada is an Edmonton-based accounting and advisory firm founded in 2020, with a second office in Vancouver, that works regularly with newcomer and international founders. We help you choose the right incorporation jurisdiction, set up your Business Number and CRA program accounts, establish clean cloud bookkeeping from the first transaction, and assess your personal tax-residency position so foreign income and cross-border ties are handled correctly. Our founder, Ozgur Duymaz (Ph.D., CPA Canada, ACCA UK, CMA US), brings cross-border accounting and tax expertise to these exact situations. Learn more about our bookkeeping and tax filing service.
Frequently asked questions
Yes. Anyone can incorporate federally or in most provinces, including newcomers. Federal incorporation requires at least 25% of directors to be Canadian residents, while Alberta and British Columbia have no director-residency requirement, making provincial incorporation simpler for many newcomers.
You generally become a Canadian tax resident the day you establish significant residential ties — most often a home available for your use, plus a spouse or dependants living here. From that date, your worldwide income is taxable in Canada. The CRA treats your first year of residency as your newcomer year.
Only once your worldwide taxable revenue exceeds $30,000 over four consecutive calendar quarters (or in a single quarter). Below that, registration is voluntary. As of the 2026 tax year, new GST/HST registrations are completed online through the CRA Business Registration Online portal.
Yes. Once your corporation is registered and you have its articles of incorporation, business number, and personal ID (passport plus proof of Canadian address), the major banks will open a business account. Newcomer banking packages can simplify the personal-account step that often comes first.
A Business Number (BN) is the 9-digit identifier the CRA uses for your corporation. Federal incorporation usually generates it automatically; Alberta provincial corporations register for it with the CRA afterward. Program accounts (GST/HST, payroll, corporate income tax) are added as extensions of the BN.
As a Canadian tax resident you report worldwide income, but Canada's tax treaties and foreign tax credits generally prevent the same income from being taxed twice. Income earned before you became a resident is usually outside the Canadian net. Cross-border situations are fact-specific and worth professional review.