Top Considerations When Starting a New Business

Starting a new business is an exciting adventure that comes with its fair share of challenges. Whether you're new to Canada or just starting your entrepreneurial journey, getting the basics right is key to success. From that first spark of an idea to becoming a fully operating business, TD is here to support you every step of the way.

One of the first steps in starting a business is coming up with an idea. You’ll want to consider picking something that not only excites you but also has the potential to grow and succeed in the long run. Doing your homework with market research can help set you up for success:

• Understand Demand: Make sure there’s a real need or desire for your product or service—this is a helpful sign your idea has a solid foundation.
• Identify Your Target Audience: Get clear on who your customers are and what they’re looking for so you can tailor your offerings to meet their needs.
• Analyze Competitors: Take a look at what others in your industry are doing well (and not so well) so you can carve out your own niche.

Once you’ve nailed down your idea and done your research, you’ll be in a stronger position to start planning next steps: including securing the right financing to help bring your business to life.

Securing the right financing is a big deal when launching your business. It’s all about finding the funding option that suits your unique situation. Here are some options to consider, with a few offerings from TD to help.

• Personal Investment: Using your own savings to kickstart your business.
• Friends and Family: Borrowing money from the people who believe in you.
• Business Loans and Lines of Credit: Getting loans through financial institutions. Check out TD Credit Solutions.
• Credit Cards: TD Business Credit Cards can give you higher limits, better rewards, and easier financial tracking compared to personal cards.
• Angel Investors: Bringing on private investors who believe in your vision.
• Venture Capital: Seeking out investment from venture capital firms to fuel growth.
• Grants and Subsidies: Applying for government or private grants to give your business a financial boost.
• Business Incubators: Joining programs that support startups with resources and mentorship.

For help creating a framework outlining your business concept and its financial considerations, take a look at our business plan template. Tools like Fundica can help you discover funding and grants. And if you’re a Black entrepreneur, don’t miss the tailored support available through our Black Entrepreneur Credit Access Program.

Whatever your path, TD Small Business Account Managers specialize in banking solutions for entrepreneurs. They will take the time to understand you, your business challenges, and your unique needs to provide helpful advice.

Choosing the right business structure is an important decision, especially when it comes to legal and tax implications. In Canada, there are three main types of business structures, each with its own pros and cons:

• Sole Proprietorship: This is the simplest and most common setup for new entrepreneurs. It’s easy to get going since you and your business are legally the same. But keep in mind, that also means you’re personally on the hook for any business debts and obligations.
• Partnership: In a partnership, two or more people share ownership. This setup lets you combine resources and skills, but it also means you and your partner(s) are jointly responsible for the business’s obligations. Usually, partners have an agreement in place that spells out how you’ll share profits, expenses, and responsibilities.
• Corporation: A corporation separates the business from its owners, who become shareholders. This setup may offer tax benefits, limited liability protection, and boost your business’s credibility. On the flip side, it requires more paperwork, ongoing legal and accounting costs, and a bit more effort to keep everything in order.

The right structure for you depends on your business needs, resources, and how you want to handle liability and taxes. Speak to a professional to understand the best fit for your business.

Once you have reviewed the pros and cons of incorporation and determine that it is right for you, TD is here to help. Together with ESC Corporate Services, we're making it easy to incorporate your business online.

Incorporating your business brings a lot more to the table than just a formal title. It can offer advantages to help give your business a solid foundation for growth. Take a look at a few benefits to consider:

1. Limit Personal Liability: Separates your personal assets from business liabilities to help limit personal liability for business owners
2. Transfer of Ownership: Ability to sell or transfer ownership through shares in addition to transfer of assets
3. Business Continuity: Ensures your business can continue to operate, in accordance with the law, even if you step away, offering long-term stability
4. Increased Credibility: Can enhance your business's reputation with customers, suppliers, and partners, signaling that you're established and reliable
5. Access to Additional Financing: Opens up the ability to raise funds through the sale of shares which can help fuel business growth

Moving to Canada and launching a business comes with its own set of steps, but with the right guidance, you can get off to a strong start.

Considerations when starting a business in Canada as a newcomer

Obtain a Multi-entry Visa: Allows you to enter and exit Canada as needed.

Start-Up Visa Program: Supports immigrant entrepreneurs in moving to Canada and starting a business.

Register Your Business: Complete the legal process to officially set up your business.

Apply for a Labour Market Impact Assessment: May be required if you plan to hire foreign workers. A positive assessment shows that there is a need for a foreign worker to fill your employment needs. It will also show that no Canadian worker or permanent resident is available to do the job.

Apply for a Work Permit: This gives you legal permission to work and operate your business in Canada.

Understand Your Tax Obligations: When starting a business, it's important to be aware of your tax responsibilities, which can vary depending on your location and business structure. You may need to register for certain taxes or file returns based on your revenue. Since tax regulations differ by based on a variety of factors, consider consulting a professional advisor to help you navigate your specific obligations.

With these steps in place, you’ll be on your way to establishing a successful business in Canada. Remember, the right support and resources can make all the difference as you start this exciting new chapter. Learn more about starting a small business as a newcomer here and here.