Start your Online Business in Canada 🇨🇦

What is Solebase?

Solebase is a specialized service that registers a Sole Proprietorship Business Name on behalf of non-residents in Canada with the government. In addition to registration, we offer a range of features to help online entrepreneurs seamlessly start and manage their online businesses.
Solebase.co is owned by a Canadian-based company, providing a trusted and convenient solution for business registration.

What Taxes Do I Have to Pay in Canada?

Disclaimer: This is not tax advice. Please conduct your own research or consult with a tax professional.
In Canada, a Sole Proprietorship is subject to two main types of taxation:
Income Tax:
- A Sole Proprietorship is taxed at the "personal income tax" level of the owner.
- If the owner is a non-resident and operates entirely online with no employees, no physical presence, no goods in Canada, and only a virtual office, they are generally not subject to Canadian income tax.
HST/GST (Sales Tax):
- This is similar to VAT (Value-Added Tax) in other countries.
- Any business that is considered to be “carrying on business in Canada” must register for, collect, and remit HST/GST once its worldwide taxable supplies exceed CAD 30,000 in the past 4 calendar quarters. (Non‑resident businesses without a substantial Canadian presence are generally exempt.)
- If you import/export goods into/from Canada or employ individuals in Canada, additional tax obligations may apply.
Taxation for Non-Resident Sole Proprietors:
A non‑resident sole proprietorship that is entirely operated from abroad may avoid Canadian income tax and GST/HST obligations if it is not deemed to be “carrying on business in Canada.”
The CRA assesses this based on several factors:
- Operational Presence: All core business activities (service delivery, management, and marketing) are conducted outside Canada.
- Physical Presence: There are no employees, agents, offices, or physical inventory in Canada.
- Place of Payment & Contracts: Where contracts are concluded and payments are received is considered in the overall analysis.
- Sales & Import/Export: For a business operated entirely from abroad, only sales made to Canadian residents count toward the CAD 30,000 threshold. If these sales remain below CAD 30,000 in the past 4 calendar quarters—and you do not import/export goods into or from Canada—you will not be deemed to be carrying on business in Canada.
Note: Income tax obligations in your home country may still apply. Please consult a local tax professional to understand your overall tax liabilities.
Business Number (BN) and Tax Registration:
- Within 10-30 days of registering your business, the Canada Revenue Agency (CRA) will automatically issue you a Business Number (BN).
- This BN is your main business tax ID. However, you can start your business activities before it is issued.
- The main BN cannot be used to pay taxes; you must register for separate tax subaccounts (e.g., GST/HST, payroll) under your BN, but only if applicable to you. Obtaining a BN does not mean you are required to pay taxes or report income.

Why this setup is better than a US LLC?

If you're a single owner, registering a Sole Proprietorship (SP) in Canada is generally better than forming a US LLC. While both are taxed at the personal level, a US LLC comes with extra compliance, tax filing, and KYC burdens. Here’s why a Canadian SP is the better choice:
Easier to Avoid Local Tax:
- With Canada’s 40 million population only, it's relatively simple for a non-resident SP owner to focus on international markets and avoid Canadian-source income. In contrast, the U.S. has over 330 million people, making it much harder to avoid U.S.-sourced income, which is broadly taxed under strict IRS rules.
Fewer KYC & Compliance Issues:
- Owning a US LLC may require disclosure in KYC (Know Your Customer) checks, even when signing up for services personally.
- This may lead to extra tax-related forms as if you were a US taxpayer, even if you are not a US resident.
No Mandatory IRS Filings or Costly Accountants:
- A US LLC must file yearly reports with the IRS (Form 5472 + Pro Forma 1120), even with no taxable income.
- If it has US-sourced income, it may be taxed based on US tax treaties.
- Hiring a US tax accountant is often necessary, adding to costs.
- In Canada, a non‑resident sole proprietor operating entirely from abroad generally does not need to file with the CRA if sales to Canadian residents remain below CAD 30,000 over the past 4 calendar quarters, with no import/export activity or employees in Canada. This is not tax advice—please do your own research or consult a tax professional.
Seamless Access to US Marketplaces & Payments:
- As a Canadian business, you have access to U.S. marketplaces and payment providers that may not be available in your country of residence.
Lower Costs & Simplified Maintenance:
- Cheaper than a US LLC, with a 5-year validity before renewal.
- A US LLC requires annual filings, state fees, and possible agent costs.
Final Verdict:
A Canadian Sole Proprietorship is the better choice, offering lower costs, easier compliance, no IRS reporting, and full access to US services. A US LLC is only useful in specific cases, like liability protection or tax structuring.

Do you offer refund?

Yes, we can offer a refund as long as we have not yet submitted your application. However, once your company has been registered, we cannot issue a refund since government fees are non-refundable. If your application is rejected by the government and it is not possible to submit a new one, we will refund $200.

What about the Free Business Address?

- We strongly recommend using a Canadian address for your business, as this can greatly help when applying for marketplaces and payment services. Since company information is publicly available, having a Canadian address can improve credibility and approval chances. That’s why we provide our own business address for free as part of our package.
You can request to change your company address at any time.
Our goal is to provide this free address service to our clients for a period of five years.
However, if for any reason we are unable to continue offering it, we will notify you and guide you on how to proceed.

How long does the process take?

After completing the payment, we will request additional information from you, including your name, business name, business activity, home country address, passport copy, and other necessary details. We aim to submit your application on the same day we receive all the required information. Once submitted, the license is typically issued within 5 to 10 business days.