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Things you should know before starting your own business

December 8, 2022   ·   0 Comments

By Brian Lockhart

Many people dream of starting their own business where they will be the boss and call the shots while reaping the benefits of their hard work.

The Province of Ontario has guidelines aimed at letting potential business owners know how they should prepare before venturing into the world of self-employment.

While you may have an idea, product, or service you think the public could use, pre-planning is a big part of having a successful operation.

First off, you should conduct market research to help you understand the industry and market you will be operating in.

You should research customer demographics, your competitors, a location, financing and find an appropriate business name.

Next, you should prepare a business plan that will guide your efforts through the goals you should achieve.

The plan should include short and long-term business goals. If you need help writing a business plan, there are agencies that can help.

You will need to decide on the ownership structure for your business. In Ontario, there is four kind of business structures – each of them serves different legal and tax needs.

These included a sole proprietorship in which there is one owner, a partnership, which is owned by two or more people, a corporation which becomes its own legal entity that keeps the business separate from the business owner, and a co-operative that is organized and controlled by its members.

Careful thought should be given as to which type of business ownership you need.

Once decided, you will have to register your business.

You must check if you need licenses or permits to conduct your business, according to federal, provincial, or municipal regulations. Depending on your business, you may need to be licensed to operate.

Once you start getting an income, you most likely will have to charge HST to your customers. If your business makes $30,000 gross, or more in four consecutive calendar quarters, you will have to charge GST / HST.

Understanding your tax obligations is a big part of being self-employed. You must report your personal income and contribute to the Canada Pension Plan every year.

Once you’re ready to open your doors, you should consider business insurance. Although business insurance isn’t mandatory, it is highly recommended, even if you operate a home-based business. It can protect your and your business’s properties, operations, and ability to generate income.

Finally, you should find out if there are any regulations required that may apply to your new business. Failing to follow regulations could mean a visit from authorities who could shut you down.

Starting your own business is an exciting venture and can be very rewarding.

Making sure you have a proper plan in place is key to ensuring success.

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