Master Business License vs. Corporation in Ontario, CA

In 2023, Ontario saw over 100,000 new business registrations. Yet many founders hit a roadblock deciding between a master business license vs. corporation Ontario. This is where liability, taxes, growth potential… all is on the line.

It’s important to answer two questions upfront: What exactly is a master business license? And how does it differ from incorporating? Let’s unpack both, so you can launch confidently.

What Is a Master Business Licence?

A Master Business Licence (MBL)—now officially called a Business Name Registration—is how sole proprietors and partnerships register a trade name under Ontario’s Business Names Act. When you register, you get a Business Identification Number (BIN) for provincial filings.

However, an MBL does not create a separate legal entity. You remain personally liable for debts and obligations. Also, it doesn’t grant exclusive rights to your business name, meaning another firm could register the same name elsewhere in Ontario.

What Is a Corporation?

In contrast, incorporating under the Ontario Business Corporations Act (OBCA) creates a separate legal entity. Your corporation can own assets, enter contracts, and incur liabilities on its own.

Key perks include limited liability, exclusive name protection, and perpetual existence—even if ownership changes. You can incorporate provincially (OBCA) or federally (CBCA). Each option has its own fees and name‑search requirements.

Key Differences | Master Business Licence vs. Corporation

Use this at‑a‑glance table to compare a master business license vs. corporation Ontario:

Feature	Master Business Licence	Corporation
Liability	Owner personally liable	Limited liability for shareholders
Name Protection	No exclusive rights	Exclusive name within jurisdiction
Initial Cost	~C$60 (5‑yr registration)	~C$360+ (provincial) + NUANS + legal fees
Renewal/Ongoing	Renew every 5 years (~C$60)	Annual return (~C$20) + T2 filings
Tax Treatment	Personal income tax rates	Corporate tax rates; small‑business rate
Complexity	Simple filings	Annual resolutions, minute book required

Pros & Cons of a Master Business Licence

Advantages	Limitations
Fast, low‑cost registration	Personal liability for all debts
Minimal paperwork and no annual returns	No exclusive claim on your trade name
–	Fewer tax‑planning options

Pros & Cons of a Corporation

Advantages	Limitations
Limited liability shields personal assets	Higher setup and professional fees
Enhanced credibility with customers and investors	Strict record‑keeping (minute book, resolutions)
Access to corporate tax benefits and deferrals	Mandatory annual returns and corporate tax filings

When to Choose Which Structure

If you’re testing a side hustle on a small budget, a Master Business Licence makes perfect sense. For roughly C$60, you can get your trade name registered and keep compliance simple. When your liability risk is low—think freelance consulting or gigs—you avoid the extra paperwork and costs of incorporation.

Once your venture starts to carry more risk or you’re eyeing investors, incorporating becomes the smarter move. It gives you limited liability protection, so your personal assets stay separate from business debts. Plus, a formal governance structure makes it easier to add shareholders and plan for long‑term growth.

How to Register

Master Business Licence

1. Create an ON e‑Licence account.
2. (Optional) Conduct a NUANS name search.
3. Complete the Business Name Registration form.
4. Pay C$60 and receive your BIN and licence.

Corporation

1. Conduct a NUANS name search (C$13–26).
2. File Articles of Incorporation (online/paper).
3. Pay the provincial fee (starting at C$360).
4. Receive your Certificate of Incorporation and corporate number.

Cost Breakdown & Budgeting

To register an MBL, you’ll pay about C$60 (provincial), with an optional NUANS name‑search fee of C$13–26. Beyond that, your only other cost is a renewal every five years at the same C$60 rate. Incorporation starts at a provincial fee of C$360, another C$13–26 for NUANS, and professional fees—legal or accounting—typically ranging from C$500 to C$1,500.

When budgeting, remember that MBL renewal is infrequent and inexpensive. Corporations face annual returns and T2 filings, so factor in ongoing accounting support to stay compliant.

Ongoing Compliance

MBL holders simply renew their registration every five years to keep their business name active. No annual filings or minute‑book maintenance are required—just a straightforward renewal process.

Corporations, by contrast, must file an annual return with the Ontario Business Registry and maintain a corporate minute book. You’ll also submit a T2 corporate tax return to the Canada Revenue Agency, so having clear processes for record‑keeping and governance is essential.

👉 For residency rules, see our guide: What Is a Factual Resident of Canada?

Conclusion

Choosing between a master business license vs corporation Ontario boils down to your risk tolerance, budget, and long‑term plan.

At SAZ Square, we’ve helped our clients raise $21M, while producing massive results for founders as well.
For a seamless setup and expert advice, reach out to SAZ Square and let our team handle the details. Our experts stay current with OBCA amendments and CRA rulings.

FAQs

Can I start with an MBL and later incorporate?
Yes. Many founders register an MBL to test the market, then incorporate when ready to scale. You’ll need a NUANS search and to file Articles of Incorporation.

Do I need a separate CRA business number for an MBL?
Not initially. An MBL provides a provincial BIN. However, if you hire employees or collect HST, you’ll register for a CRA Business Number.

What happens if my MBL expires?
Your trade name becomes inactive. Competitors could then register it. Renew within 30 days of expiry to avoid reapplication delays.