When assisting entrepreneurs throughout British Columbia in deciding between a Standard BC Incorporation and a Professional Incorporation, we hear the same query time and time again:
“What’s best for my company?”
Canada Incorporation Agency has assisted thousands of company owners in this decision and recognizes that the incorrect type of corporate structure can impact your goals in the long run.
Picking your corporate structure is much the same as deciding on the plan for your dream house, you want to make it right the first time so that you avoid a complex and costly adjustment down the road.
If you are a tech founder in Vancouver, a consultant in Victoria, or a licensed practitioner in Burnaby, knowing the major differences between the two corporate formats will enable you to make an informed choice that best suits your entrepreneurial objectives.
Let’s bring in the clarity!
Email: info@incorporationagency.ca
Phone: +1 647.945.8893
Address: 1270 Central Pky, W, Mississauga
Incorporate in BC today!
Understanding Standard BC Incorporation
A standard BC Incorporation is the most typical variety of incorporation in British Columbia, suitable for general business operations in almost any industry. When we help clients with standard incorporation, we’re actually forming a separate entity that is legally independent of the owners, giving the company a sound structure through which to conduct business.
This corporate form is the backbone behind everything from tech startups in Vancouver’s innovation hub to Surrey-based manufacturing businesses, and from retail stores in Richmond to consulting businesses in Kelowna. The advantage of a standard BC Incorporation is that it is flexible and can be applied in various types of businesses.
Best Business Activities for Standard BC Incorporation
We typically recommend standard BC Incorporation for businesses engaged in:
- Technology and software development
- Retail and e-commerce operations
- Manufacturing and distribution
- Consulting and professional services (non-licensed)
- Real estate development and investment
- Import/export operations
Restaurant and hospitality businesses - Construction and contracting
Understanding BC Professional Incorporation: For Licensed Professionals
Professional Incorporations are a specialty corporate structure reserved specifically for regulated professionals licensed by professional bodies in the jurisdiction of British Columbia. We generally describe to our clients that this is not simply an alternate form of a corporation, but rather a closely regulated form aimed at balancing the advantage of incorporation with the professional and ethics standards in licensed practice.
Unlike standard incorporation, professional incorporation is only available to professionals who are licensed by well-known regulatory agencies.
Most Suitable Professionals for Professional Incorporation BC
Typically doctors, lawyers, accountants and such are the most suitable for professional incorporations.
Key Eligibility Requirements: Who Can Choose Which Option?
Standard BC Incorporation Eligibility: When it comes to standard BC Incorporation, we are pleased to be able to report to clients that eligibility is simple and broad. In recent years, the BC government has taken great steps towards opening incorporation to more entrepreneurs, including non-residents.
Residency Requirements: Perhaps the most notable of the changes is the abolishment of the residency requirement on directors. Foreign nationals are now eligible to be directors of a BC company without having to be a resident of Canada or a resident alien. But the company must still have a registered office in the province of BC.
Age and Capacity Requirements: Directors should be at least 18 years of age and be capable of entering into a contract. Our practice is generally to satisfy such requirements in our incorporation service.
Business Activity Restrictions: Standard BC Incorporation accommodates nearly any legal business activity, with a few exceptions. Most restrictions come to regulated industries such as banking, insurance, or professional services that are required to be professionally incorporated.
Professional Incorporation BC Eligibility
Professional Incorporation BC has many difficult eligibility requirements. Why? Well because of the class, and reputability of the specific professions allowed to become corporations in BC.
Professional License Requirement: A valid, active professional license from the appropriate BC regulator is necessary for all voting shareholders, directors, and officers.
Good Standing Requirements: Professionals must be in good standing with their governing authority, free from any disciplinary action outstanding or practice restrictions forbidding the creation of a professional incorporation.
Scope Limitations of Professional Practice: A Professional incorporation is allowed to conduct only those activities that are under the approved scope of professional practice of the governing authority.
A medical professional incorporation cannot undertake legal services, nor vice versa.
Comparison Overview:
Standard BC Incorporation:
- Open to Canadian and foreign entrepreneurs
- No professional license required
- Broad business activity permissions
- Minimal ongoing professional requirements
Professional Incorporation BC:
- Limited to licensed professionals
- Requires current professional license
- Restricted to professional practice activities
- Ongoing professional compliance required
Differences Side-By-Side
Flexibility: Standard BC Incorporation wins with broader business activity permissions and ownership flexibility, while Professional Incorporation BC is limited by professional practice scope and ownership restrictions.
Tax Benefits: Both structures offer significant tax advantages, but Professional Incorporation BC may have additional opportunities for tax deferral and professional expense deductions.
Liability Protection: Both provide limited liability protection for business obligations, but Professional Incorporation BC cannot shield against professional malpractice claims.
Compliance Requirements: Standard BC Incorporation has standard corporate compliance requirements, while Professional Incorporation BC has additional professional regulatory compliance obligations.
Tax Implications: How Each Structure Affects You
Standard BC Incorporation Tax Considerations
Making an informed decision on the structure of your business requires an understanding of the tax implications of standard BC Incorporation.
Our clients work with their accountants to create tax plans that maximize incorporation’s tax benefits while adhering strictly to Canada Revenue Agency guidelines.
Benefits of the small business deduction: The small business deduction is another significant benefit of maintaining a Standard BC firm. Corporations that qualify under this clause will pay less in taxes on their first $500,000 in active business income in 2025. In British Columbia, this translates to a combined federal and provincial rate of roughly 11%, but high-income individuals’ personal rates exceed 53%.
Tax Deferral Planning: standard BC Incorporation allows complex tax deferral plans. Income retained in the company is subjected to the lower corporate rate, with personal tax being delayed until dividends are paid to shareholders. Deferral can be very helpful in a business with seasonal income or in businesses that will experience a lot of capital investment.
Capital Gains Exemption: Under certain circumstances, shares in a qualified small business corporation can be eligible for the lifetime capital gains exemption, which can yield massive tax savings when the business is eventually sold. In 2025, this is a sum of $971,190 per individual.
Income Splitting Opportunities: Whilst recent tax reform had restricted income splitting through sprinkling rules, real opportunities still exist through standard BC Incorporation. These are reasonable wages to members of a family employed in the company and dividends on a contribution based on a fair market value.
Professional Incorporation BC Tax Considerations
For qualified professionals with high incomes and erratic income cycles, Professional Incorporation BC offers unique tax advantages.
Professional Expense Deductions: Compared to individual practitioners, Professional Incorporation BC is able to deduct a wider variety of professional expenditures.
These may include:
- Professional development and continuing education costs
- Professional liability insurance premiums
- Equipment and technology investments
- Office and administrative expenses
- Professional association fees and memberships
Professional businesses are in a position to utilize advanced retirement strategies, such as corporate-owned life insurance and pension plans, to which solo practitioners might be ineligible.
Whereas Family income sharing is where members of a family contribute a substantial amount to the practice, Professional Incorporation BC is allowed to share income with them on a reasonable basis.
Tax Compliance Considerations for Both Structures
Quarterly Tax Payments: Large corporations with high tax bills might be asked to make quarterly payments of taxes.
Corporate Tax Filing Requirements: standard BC Incorporation and Professional Incorporation BC both require annual corporate tax returns to be filed even if no tax is payable.
Personal Tax Integration: Dividend income and capital gains are reported by shareholders in both corporate forms on their own tax returns.
At Canada Incorporation Agency we offer support and help to you with everything from accounting, legal, incorporation, trademarks, and more!
Contact us today to learn more!
Step-by-Step Comparison
Standard BC Incorporation Formation Process
The formation process for standard BC Incorporation has been streamlined significantly in recent years, making it possible to complete incorporation within hours when all documentation is properly prepared.
Step 1: Business Name Selection and Approval For Standard BC Incorporation
Named Corporation: Select a distinctive company name and use the BC Name Request and then actually send BC Registries the Name Request preferred through the portal. Usually, this procedure takes one to three business days. The name must have a legal suffix, like “Corp.” or “Inc.” or “Ltd.” or “Corporation.”
Numbered Corporation: Accept an automatically assigned number (such as “1234567 B.C. Ltd.”), avoiding the name approval process. This permits incorporation on the same day, and a trade name can be added at a later time.
Step 2: Prepare Incorporation Documents
We prepare the Articles of Incorporation Including:
- Corporate name (approved or numbered)
- Have a registered office address in BC. If you do not have a registered office address in BC we offer registered office addresses with mail screening services.
- Records office address in BC
- Director information (minimum one director)
- Shares structures (Multiple)
- Authorized share capital
- Transfer restrictions (if any)
Step 3: File Incorporation Application
You can file online through us at, Canada Incorporation Agency within 2 business hours and the incorporation application is filed electronically with BC Registries online securely, including:
- Completed Articles of Incorporation
- Notice of Articles form
- Registration fee payment
- All supporting documentation
Step 4: Receive Corporate Documents
Upon approval (typically within 2-4 hours for numbered corporations, 1-2 days for named corporations), you receive:
- Certificate of Incorporation
- Articles of Incorporation
- Notice of Articles
- Initial corporate registry extract
Step 5: Post-Incorporation Setup
- Register for Business Number with CRA
- Open corporate bank account
- Establish corporate records and minute book
- Register for applicable tax accounts
- Obtain necessary business licenses
Professional Incorporation BC: The Registration Process
The formation process for Professional Incorporation, involves additional steps and regulatory approvals, typically extending the timeline.
Step 1: Professional Eligibility Verification
Before beginning incorporation, we verify:
- Current professional license status
- Good standing with regulatory body
- Specific professional incorporation requirements
- Name format requirements (typically must include professional surname and designation)
Step 2: Professional Name Approval Process
Professional Incorporation BC names must typically include:
- The professional’s surname (and sometimes given name)
- Professional designation (e.g., “Medical”, “Legal”, “Dental”)
- “Professional incorporation” or approved abbreviation Example: “Dr. Sarah Johnson Medical Professional incorporation”
Step 3: Obtain Professional Pre-Approval
Many professional regulatory bodies require pre-approval before incorporation:
- Submit professional incorporation application to governing body
- Provide proposed Articles of Incorporation
- Pay professional application fees
- Wait for professional approval (typically 1-2 weeks)
Step 4: Corporate Incorporation Filing
Once professional pre-approval is received:
- File Articles of Incorporation with BC Registries
- Include professional approval documentation
- Pay incorporation fees
- Receive corporate documents
Step 5: Certificate of Authorization Application
After incorporation, apply for Certificate of Authorization from professional regulatory body:
- Submit completed authorization application
- Provide incorporation documents
- Pay authorization fees
- Receive Certificate of Authorization
Step 6: Complete Professional Registration
- Register with CRA for Business Number
- Set up professional liability insurance
- Establish client trust accounts (if required)
- Complete professional practice setup
Timeline Comparison
Standard Incorporation Timeline: Same day to 3 business days
Professional Incorporation Timeline: 2-4 weeks
We manage both processes for our clients, handling all government filings, regulatory communications, and ensuring full compliance with all requirements. Our experience with professional regulatory bodies across BC allows us to navigate the process efficiently and avoid common delays.
Learn more about how we can help you get started with registering right away!
Making the Right Choice
BC Incorporation Decision Factors To Know
If you have the following BC activities, a standard incorporation considered standard would be most suitable for the following industries:
- Multiple revenue streams or diverse business activities
- Plans for rapid expansion or geographic growth
- E-commerce or technology-based operations
- Manufacturing, retail, or distribution activities
- Consulting services not requiring professional licensing
- Real estate investment or development
Professional Incorporation Decision Factors To Know
Professional Practice Assessment: A Professional incorporation, becomes the preferred choice when:
- You hold a current professional license requiring professional incorporation
- You want to separate professional and business liabilities
- You’re planning professional practice expansion or partnerships
- You need enhanced tax deferral strategies for variable professional income
Conclusion: Making the Best Choice for You
Already thousands of resourceful Canadian business owners have learned about our secure online process that produces the same legal outcome in an easy 5 steps.
You shouldn’t be giving up quality for cost or wasting weeks on paperwork when you can get your corporation comparatively swiftly, accurately, and reasonably.
So, whether you’re looking to start a standard Incorporation or a professional incorporation, become a part of the thousands of Canadians who’ve let us walk them through the easy process that incorporates you without the expense of a lawyer, every step of the way.
Click here to start either a standard BC Incorporation or here for a Professional Incorporation.
Click here to learn more from our partnering BC Online Business Registry.
FAQs: Standard BC Incorporation vs Professional Incorporation
1. What’s the main difference between a standard BC Incorporation and a professional incorporation?
Almost any business owner can form a standard BC Incorporation, regardless of whether they are operating a retail store, consulting firm, or software startup. It is simple to set up! A professional incorporation is only for licensed professionals, such as engineers, doctors, lawyers, and accountants.
2. Which Incorporation option will save me more money on taxes in BC?
Depending on your particular circumstances, either structure may result in significant tax savings. In contrast to personal tax rates, which can reach over 50%, standard corporations are eligible for the small company tax rate, which is approximately 11% combined federal and provincial, on the first $500,000 of active business income. To learn more simply contact us today.
3. Will incorporating actually protect my personal assets if something goes wrong?
Yes, but with a few crucial disclaimers. Both kinds of corporations put your personal assets and business behind a legal wall. Your home, vehicle, and personal resources are typically safeguarded in the event that your business is sued or incurs debt.
4. How long does the whole incorporation process take, and what’s involved?
With Canada Incorporation Agency we can have you incorporated within just 2 business hours.
Typically, standard BC Incorporation is pretty quick and painless. If you go with a numbered company, you can literally be incorporated the same day.
If you want a custom business name, add 1-3 days for name approval. The whole process typically wraps up within a week once you have all your paperwork ready.
