Where to incorporate — federal or provincial — and what extra-provincial and foreign corporations must do.
Business · Updated July 2026 · 8 min read
A corporation in Canada is created under either a federal or a provincial statute. Both give you a separate legal person with limited liability; they differ in where the corporation is recognised, what it costs, and what ongoing registration it needs.
A corporation formed under the Canada Business Corporations Act can carry on business anywhere in the country and receives strong protection for its name across Canada. Federal incorporation no longer requires Canadian-resident directors — that requirement was removed in 2020 — which can suit businesses with owners abroad. A federal corporation must still register in each province or territory where it actually carries on business.
A corporation formed under a provincial act, such as Ontario's Business Corporations Act, exists under that province's law. For a business operating in a single province this is often simpler and less expensive, and its records are kept provincially. If the business later expands into other provinces, it registers there as well.
Carrying on business in a province other than the one where the corporation was formed generally requires registering there as an extra-provincial corporation. This is a registration step, not a second incorporation: the corporation remains one legal person, but it becomes known to, and regulated by, each province in which it operates. What counts as “carrying on business” varies by province and can include having an address, employees or a physical presence there.
A company incorporated outside Canada that begins to carry on business in a Canadian province must usually register extra-provincially or obtain a licence in that province, much as a domestic corporation from another province would. Registration does not make it a Canadian corporation; it authorises the foreign corporation to operate locally and identifies it to the province.
This guide is general legal information, not legal advice. For a specific matter, consult a lawyer licensed in your jurisdiction.