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216 Government regulations Every partnership must comply with Federal, Provincial and Municipal Government business regulations. These laws concern business licences, tax collection, keeping records of your business transactions, and regulations about employees.
- Business licenceRegardless of whether you conduct business from a commercial office or from your home, you may be required to obtain a business licence. Business licences are issued by your municipal licensing board and are usually inexpensive. Specialty licences or provincial or federal licences can also be required. For example, if you sell liquor, you will need a provincial liquor licence. If you own a restaurant, you will need a licence to sell food. A lawyer can help you determine what type of licence you will need for your business.
- TaxesMost businesses will also need to register to collect the Provincial Sales Tax, PST and GST, the federal Goods and Services Tax. Ontario businesses must collect 8% Provincial Sales Tax and 7% federal Goods and Services Tax on most goods and services that they sell. You can register for the Provincial Sales Tax at the Retail Sales Tax Government Branch. You can register for the Goods and Services Tax through Canada Revenue Agency. Canada Revenue Agency will issue you a business number that you will use when submitting GST remittances. Businesses with total sales of less than $30,000 in a moving 12 month period are not required to register for the Goods and Services Tax.
- Business accounting recordsYou will need to maintain records of your business transactions including sales records, bank statements, expenses and cancelled cheques. It is a good idea to hire an accountant or bookkeeper to help you with this.
- Regulations about employeesIf you have employees, you are required to deduct employment insurance premiums, Canada Pension Plan contributions, and income tax from employee salaries. Generally, these deductions, along with your employer's contribution to employment insurance and the Canada Pension Plan, must be submitted to Canada Revenue Agency by the 15th day of every month. The deduction amounts are set by Canada Revenue Agency.
In order to properly make and submit employee deductions, your business must register with Canada Revenue Agency. Canada Revenue Agency will then issue you a business number. This business number is the same as the one you are issued for GST purposes, except that it ends with the letters PR.
If your business has employees, you may also need to register with the Workplace Safety & Insurance Board. The Workplace Safety & Insurance Board recently replaced the Workers' Compensation Board. It provides funds for people who are injured at work. You can contact the Workplace Safety & Insurance Board for a free information and registration kit.
In addition to these general regulations, there are many specific government regulations that may apply to your business. It is important to make sure that you comply with all applicable regulations. If you are uncertain about which regulations apply to you, you should contact a lawyer for advice.