How to start a business in Ontario, with every fee and what 620+ Ontario businesses earn

The short answer

The pages that rank for this search are a law firm explaining Ontario versus federal incorporation, a sole-proprietorship blog, a Reddit thread and a few directory pages. Each covers one step. None says what an Ontario business earns once it is running. This guide covers every registration step with the current fee, then uses the Main Street Index, BigIdeasDB’s census of 84,900+ businesses-for-sale listings, to answer the second question searchers ask: which small businesses in Ontario are the most profitable, and is it cheaper to buy one than to build one.

Read that table as a ceiling: a one-person service business in its owner’s name can legally start for $0 in government fees. The money goes into equipment, insurance, premises and the months before revenue covers your living costs, which our cost to start a business guide breaks down by business type.

Sole proprietorship, partnership or corporation in Ontario

Ontario recognises four business structures, and ontario.ca calls the sole proprietorship “the easiest and most common way to start a business” (ontario.ca, Decide on the ownership structure). The trade-off is liability. A sole proprietor is personally responsible for every business debt, and the province’s own list of cons says “creditors can take your personal assets.” A partnership spreads that liability across all partners. A corporation is a separate legal person, so its debts are generally its own.

• Sole proprietorship: one owner, profit taxed at your personal rate, losses deductible against other income, name not protected.
• General partnership: two or more owners, all liable for all debts. Write a partnership agreement before you open the bank account.
• Corporation: limited liability, can issue shares and is easier to sell, but costs more to set up, files its own tax return and must keep corporate records.
• Co-operative: member-controlled, one member one vote. Rare for a first small business.

The confusion between these is the most common mistake in the Reddit threads Google ranks for this search. One reply to a new Ontario founder put it plainly:

“You have 2 things mixed up. A sole prop and a corporation, two separate things.”r/PersonalFinanceCanada

A practical rule: start as a sole proprietor while you test whether anyone will pay. Incorporate when the business carries real liability (staff, a lease, physical work on customers’ property) or when profit is high enough that leaving money in the company saves tax. Ask an accountant to run that second test with your numbers.

Ontario vs federal incorporation: $300 or $200

Incorporating in Ontario costs $300 through the Ontario Business Registry and is processed immediately online (ontario.ca fee table). Unless you accept a number name, you also need an Ontario-biased or weighted Nuans name search report from a private search house, and a federally biased report is not accepted (ontario.ca, Register your business online).

Federal incorporation costs $200 when the articles are sent through Corporations Canada’s online service and $250 by any other means, under Schedule 5 of the Canada Business Corporations Regulations, 2001. The same schedule sets the federal annual return at $12 online. In exchange you get a name protected across Canada and the right to carry on business in any province (Canada.ca, federal or provincial incorporation).

The federal option is not “Ontario plus more.” A federal company that operates in Ontario still files an initial return with the Ontario Business Registry, which Ontario lists at $0 for extra-provincial corporations. So a federal corporation running only in Ontario keeps two registries current for a $100 saving at setup. Federal makes sense when you expect to sell outside Ontario or need the name protected nationally. Ontario makes sense for a local shop, crew or practice. ontario.ca notes you can switch from provincial to federal later.

Registering a business name under the Business Names Act

You must register a sole proprietorship only if you are not using your own name as the business name; any trade name, partnership or limited partnership is registered with the Ontario Business Registry (ontario.ca). “Jane Smith” needs no registration. “Jane Smith Renovations” does. The fee is $60 for a sole proprietorship, general partnership or limited liability partnership and $210 for a limited partnership, and you receive a 9-digit Ontario Business Identification Number (BIN), which is not the same as CRA’s business number.

The registration, formerly called a Master Business Licence, expires every 5 years. You can renew online from 6 months before expiry to 60 days after it, for the same $60. Miss that window by more than 60 days and you must register the name again as new, with a new BIN and company key (ontario.ca, Ontario Business Registry: all services). Put the expiry date in your calendar the day you register. Searching the registry before you file is free, and cancelling a sole proprietorship costs nothing.

A registered name is not a protected name. Ontario’s own pros-and-cons list says a sole proprietor’s business name is not protected. If the name matters, check the registry, the federal corporation search and a trademark search before you print anything. Our guide to checking whether a business name is taken walks through the searches.

CRA business number and HST at $30,000

Your CRA business number (BN) is the federal tax identity for GST/HST, payroll and corporate tax. Since July 14, 2026, Business Registration Online is available only through a CRA account, and you can open the BN and the GST/HST, payroll deductions and corporation income tax accounts in one session. Ontario residents can transfer straight from that session to the provincial registration site (CRA, Register as a resident). If you incorporated federally, you may already have a BN.

HST is where most Ontario starters get caught. You are a small supplier, and may choose not to register, while your taxable sales stay at or under $30,000 over four consecutive calendar quarters. Cross $30,000 in a single quarter and you must charge HST on the very sale that pushed you over. Cross it over four quarters and you stop being a small supplier at the end of the following month. Either way, you have 29 days to register (CRA, When to register for and start charging the GST/HST). Ontario’s HST rate is 13% (CRA rates table).

“If your gross revenue as an independent contractor exceeds $30,000 per year, you need to register to charge HST to all your customers.”r/PersonalFinanceCanada

One correction to that common summary: the test is four consecutive calendar quarters, not a calendar year, and one big quarter can trigger it on its own. The same reply points out the upside of registering, which matters when start-up purchases are large and early sales are small: it “will also let you get back any HST you pay on your business expenses.”

The $30,000 threshold has nothing to do with income tax. Every dollar of business profit is taxable. A sole proprietor reports it on Form T2125 with their personal return. A second reply in the same thread gives the advice on cash flow is worth following from your first invoice:

“I’d also start saving 15-20% of each paycheque from this point on as a plan to pre-pay taxes.”r/PersonalFinanceCanada

Licences and permits: the Toronto example

Ontario has no single general business licence. Licences come from three levels of government depending on what you do and where, and the province points every starter to BizPaL, a free tool that filters permits by location, industry and activity.

Municipal licensing is where the rules differ most. In Toronto, Municipal Code Chapter 545 (Licensing) requires a city licence before you trade in a long list of businesses, including eating or drinking establishments, personal service settings, plumbing contractors, heating contractors, renovators, building cleaners, laundries, pet shops, public garages, second-hand dealers and tobacco or vapour retailers. Some of those, such as holistic centres, need a separate licence for the owner and each practitioner. Toronto’s licensing staff answer at 416-392-6700 (City of Toronto). Other Ontario municipalities set their own lists, so run BizPaL for your exact address.

Trades add a provincial layer. Plumbing and electrical work are compulsory trades in Ontario, so the person doing the work needs the certificate whatever the company structure, as one tradesperson explained:

“If you’re doing any other type of trade work such as plumbing or electrical, these trades are compulsory and you do require a red seal to work in these trades.”r/SkilledTradesOntario, on starting a renovation business

Zoning is the licence step people forget. Toronto asks for a review of zoning compliance before it issues some licences, nightclubs among them. Check the zoning of a unit before you sign the lease.

Hiring in Ontario: WSIB and the Employer Health Tax

WSIB. By law, most businesses must register with the Workplace Safety and Insurance Board within 10 calendar days of hiring their first employee; construction has its own, stricter rules (WSIB registration Q&A). Registration is free and usually issues an account number immediately, but premiums follow, set by your industry class and insurable earnings. Not every industry is covered: the Workplace Safety and Insurance Act lists which ones must be. If a customer asks for a WSIB clearance certificate at registration, most new businesses make a $250 advance payment that is credited to future premiums (WSIB, new businesses).

Employer Health Tax. EHT is Ontario’s payroll tax, and most small employers never pay it. Eligible employers (taxable, not government-controlled, with Ontario payroll under $5 million including associated companies) are exempt on the first $1 million of annual payroll. Above the exemption, the rate depends on total payroll before the exemption: 0.98% up to $200,000, rising in steps to 1.95% over $400,000. The return is due March 15, and monthly instalments start only once payroll passes $1.2 million (Ontario Ministry of Finance, Employer Health Tax).

Put in plain terms: a business with 10 staff at $60,000 each has a $600,000 payroll and owes no EHT. Watch the associated-employer rule if you own two companies, because they share one exemption.

The most profitable small businesses in Ontario, by real earnings

Of the Ontario sectors with 30 or more listings that state both earnings and revenue, manufacturing has the highest margin: owners state a median 28.2% of revenue as seller’s discretionary earnings (SDE), on $281K of SDE (BigIdeasDB Main Street Index, n=34 and n=37, October 2026). Home and trade services follow at 23.2% on $243K (n=48 and n=50). SDE is profit plus the owner’s own pay and perks, the figure a buyer lives on.

Two warnings before you read the table. First, no single industry in Ontario reaches 30 listings with earnings (restaurants are the largest at 24 listings in total), so we rank sectors, not industries. Second, these are businesses for sale, which skews toward established, mid-sized firms; the median Ontario listing has been running for 14 years (n=335).

The Ontario medians tell you something the generic “most profitable business” lists miss: the highest-margin sector is also the most expensive to enter. Ontario manufacturing businesses ask a median $900K (n=51) and 3.27x their SDE (n=34). Home and trade services earn nearly as much in dollars ($243K) for $390K, at 3.04x (n=43). Retail is the cheapest per dollar of earnings at 2.83x (n=30), but on $152K of SDE.

Ontario as a whole asks a median 3.07x SDE (n=219), against 3.24x for the rest of Canada (n=371), 3.23x in British Columbia (n=86) and 3.24x in Alberta (n=166). The median Ontario listing asks $400,000 (n=503) for $228K of stated SDE (n=245), a 23.2% margin (n=228).

For sectors too thin to measure inside Ontario, the Canada-wide cut is the next best evidence. Read it as Canada, not Ontario:

Business and professional services lead Canada at a 34.1% margin and the lowest multiple in the table, 2.85x (n=45). The group mixes printing and signage shops, its largest member, with staffing, bookkeeping, marketing and waste services, so the margin is not only a skills-business margin. Retail sits last at 15.7% (n=81). For the wider picture across all industries, see our business success rate study.

Who is selling Ontario’s best earners: retiring owners

Two in three Ontario manufacturing sellers who give a reason say they are retiring: 67.6% (n=37), the highest retirement share of any Ontario sector we can measure (BigIdeasDB Main Street Index, October 2026). Retail follows at 65.1% (n=43) and home and trade services at 57.9% (n=38). Food and beverage is the one measurable Ontario sector where fewer than half are retiring: 46.9% (n=32).

Across all Ontario listings, retirement is the reason on 53.3% of stated owner exits (n=289) once non-answers and non-owner sales are set aside. Retiring owners’ businesses are older and bigger than the rest:

For a starter this cuts two ways. The profitable, established end of Ontario’s small-business economy is changing hands because its founders are leaving, which means there is a supply of working businesses, customer lists and trained staff for sale at roughly the same multiple as everything else (3.21x against 3.14x). It also means a new manufacturing start-up competes against shops with two decades or more of customers. If manufacturing is your field, our guide to buying a manufacturing business and buying from a retiring owner cover the deal side, and the Canada retiring-owner study compares provinces.

Buy instead of start? What Ontario businesses ask

Starting is cheap on paper and slow in practice. Buying is fast but expensive. Ontario’s 500+ priced listings show where the realistic entry point sits: businesses asking $250K to $500K state a median $150K of SDE at 2.63x (n=54), and the median ask among those with earnings is $375K (BigIdeasDB Main Street Index, October 2026).

150+ Ontario listings ask under $250K, but fewer than 30 of them state earnings (n=28), too few for a median. Sellers of small businesses often leave the earnings line blank, so treat every cheap listing as unverified until you see tax returns. The pattern above $250K is clear: bigger businesses ask higher multiples, from 2.63x in the $250K to $500K band to 3.95x at $1M and up (n=78).

Does a $375K Ontario business pay you? An illustration, not a lender quote: take $150K of SDE, pay yourself $80K, and $70K is left for debt. Borrowing 90% of $375K ($337,500) over 10 years at an assumed 8% costs about $50,300 a year, so the business covers its loan about 1.4 times. You would still need $37,500 down plus closing costs, and the SDE is the seller’s figure until your accountant confirms it. Our down payment guide and valuation guide show how to test both.

Home-based Ontario businesses are the cheapest way in. 85+ Ontario listings are flagged home-based, and their median ask is $150,000 (n=73) against $482,500 for premises-based listings (n=430). Home and trade services, such as cleaning and towing, is the most common sector among them. Fewer than 30 state earnings (n=19), so we do not publish their SDE. Compare that $150,000 with the $0 to $300 it costs to register your own home-based business, and the real question becomes how long it would take you to build the same customer base.

Our buy vs start comparison runs that trade-off with numbers, and how to buy a business covers the process. If you are comparing Ontario with other markets, the Canadian buyer’s guide has every province, and best state to buy a business covers the US. To filter the Ontario listings yourself by sector, price and exit reason, use the Main Street Index.

The easiest business to start in Ontario for beginners

The easiest legal start is a sole proprietorship in your own name: no registration, no fee, and you can begin invoicing today, provided your activity needs no licence. The easiest profitable start is a different question. Our Canada-wide data points to service work where the owner’s skill is the main input: business and professional services carry the highest SDE margin (34.1%, n=45), and home and trade services hold 23.9% across 100+ listings with earnings (n=106).

• With almost no money: bookkeeping, tutoring, cleaning, consulting or a trade you already hold. Keep it in your name until you pass $30,000 or take on liability.
• With $10,000 to $50,000: a van-based service (cleaning, small renovations without compulsory-trade work, junk removal), where the money buys equipment and insurance, not premises.
• With $50,000 to $150,000: either a funded start-up or a down payment on an existing business. The median home-based Ontario listing asks $150,000 (n=73).

Before you commit, test demand with paid work, not surveys. Our guides on starting a business with no money, what business to start and the easiest small businesses to run go further, and the national version of this guide covers the steps in other provinces.

What this data cannot tell you

• Asking, not closing. Every price and earnings figure is what a seller states in a listing. Final prices are usually lower and SDE is unaudited.
• Businesses for sale are not all businesses. Listings skew to established firms (median 14 years in business, n=335). They say little about how a brand-new Ontario start-up performs in year one.
• One marketplace source for Canada. All Canadian listings come from one listings site; broker-only and off-market deals are missing.
• Sectors, not industries. No Ontario industry reaches 30 listings with earnings, so rankings are at sector level, and some sector cells are withheld.
• Exit reasons are what sellers choose to say. 340+ Ontario listings give no usable reason.
• Fees and rules change. We checked every fee on October 6, 2026. Confirm with ServiceOntario, CRA and your city before you file, and get legal and tax advice for your situation.

Methodology and data sources

We started from 84,900+ listings in the Main Street Index and kept non-duplicate Canadian listings quoted in Canadian dollars on an SDE basis (1,800+), then the 620+ located in Ontario, all read with read-only SQL on October 6, 2026. Sector is an AI-assisted industry classification rolled up to sector. SDE margin is stated SDE divided by stated revenue; the multiple is asking price divided by stated SDE. Every figure is a median, and any cut with fewer than 30 listings is withheld. We screened for templated look-alike listings: no earnings-and-revenue pair repeats on three or more Canadian listings, and the handful that repeat twice (under 2% of listings with earnings) are kept. Separately, 70+ franchise new-territory adverts repeat the same description across provinces, 30 of them in Ontario. We keep them because almost none state earnings, so they do not move any margin or multiple, but they lower all-listing asking prices: Ontario’s median ask is $400,000 with them and $450,000 without, the screened figure our Canada start-up guide uses. Business age is years in operation as stated, else 2026 minus the founding year. Sector retirement shares, like the Ontario total, use stated owner exits only (non-answers and non-owner sales excluded). Some listings carry “sold” or “under contract” tags in their headlines; their figures are still the original asking figures. The loan illustration uses our assumptions (90% financed, 10 years, 8%, $80K owner salary).

Frequently asked questions