History of Canada

Canada, bordering the north of the USA, is the world’s second largest country. As a former French, and later British colony, Canada is influenced by these two cultures and retains the Queen of England as the head of state. Canada comprises ten provinces and three territories, it is highly developed and industrialized, generating wealth from its many natural resources.

Canada as an Offshore Destination

Canada is a strong offshore destination since it allows business to be done quickly and above all very simply. It benefits from its excellent reputation (the best along with Hong Kong),  powerful banks and flexible legislation. The country also offers its companies the ability to sell products into the United States through several treaties established with its neighbour. Only two Canadian provinces offer the offshore tax rate of 5%.

Canadian offshore companies offer limited liability and may hold shares in foreign companies. There are several types of Canadian companies: resident, non-resident, transient, nominee and agent. The establishment of an offshore company requires no minimum capital and, in some regions, does not require any local presence. Canadian offshore companies are not taxable if they have no activity in Canada.

Canada Summary

Canada is a new player in the world of offshore companies with some provinces, including Quebec, offering low tax companies. Canada is the most preferable destination for compliant tax planning since it has no negative offshore reputation and no association with tax avoidance or evasion. It is by far one of the best neutral jurisdictions, providing offshore benefits without any of the traditional offshore drawbacks.

Types of Canadian Company

The formation of a Canadian company can be accomplished by a notary or a lawyer, and takes around five days.

Legal EntityShare CapitalNumber of Shareholders, Members or Partners
Sole TraderNot ApplicableA sole trader is personally liable for all business debts. Liability extends to private wealth, no limited liability.
General PartnershipNot ApplicableMinimum of two partners. Unlimited liability for debts and obligations, liability is joint and several.
Capital Company (Corporation)No minimum capitalOne-person limited liability company with capital of various shareholders.
Private company with a Canadian shareholderNo minimum capitalLimited liability.
Private Limited CompanyNo minimum capitalOne shareholder required, liability limited to the capital which may be nominal.
Public companyNo minimum capitalInvestment partners, limited liability.
CooperativeNo minimum capitalTwo members required, limited liability.

 


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