How do you need a business license to sell online in Canada on the Shopify Ecommerce Platform?
Last Updated | April 24, 2023
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Overview: How do you need a business license to sell online in Canada
Canada might be on your radar for experiencing the winter wonderland, but when it comes to business, things can be challenging. For the most part, setting up an online business in Canada isn’t that difficult, however, things start to get a little crazy when it comes to making money out of the eCommerce store.
That’s primarily because the competition is massive, while the customers also make things harder by demanding a completely customized shopping experience.
This has become a widely known fact in the diverse regions where expats live in larger proportions. Just like Shopify in Dubai offers products that are customizable for a particular group of people.
Last but not the least, the online industry is a heavily regulated industry, which means eCommerce stores may have to comply and pay taxes on online sales.
While there may be many challenges to eCommerce stores in Canada, it doesn’t mean there aren’t opportunities.
I mean for starter, Shopify, which is one of the world’s largest eCommerce web development platforms roots its origin in Canada. This says much about the crazy competition and online market in Canada.
Well, in this blog we won’t be discussing how can you succeed in the Canadian online market. Rather, we will exclusively be looking at regulations for Shopify SAP integration eCommerce businesses.
So, let’s get started…
Do I Need To Register An Online Business In Canada?
Registering an online business in Canada can be complicated, and yes, everyone needs to register an online business in Canada. For starters, online sellers who wish to register a business in Canada needed to be either landed immigrants or Canadian citizens to start a business. This means that people on a student visa, work permits, or visitors cannot do business online or in-store.
Some people do partnerships with Canadians to operate the business, but it doesn’t confirm the residency in Canada. However, there is one exception when it comes down to business registration. To illustrate, if you are likely to use the legal name or start a sole proprietorship business in Canada, you don’t need to register the business.
However, there are still chances that business owners need to register the business with the municipality committee. Still, registering an online business doesn’t necessarily offer protection to the business name. So, the answer to your question, “do I need to register my online business in Ontario?” is yes as long as you don’t have the sole proprietorship business.
Do You Need A Reseller Permit To Sell Online In Canada?
If your business is selling products and goods, irrespective of the selling medium (online or in-store), you need to have a sales tax permit, which is also known as a seller’s permit. Generally, it’s essential to have the reseller permit or certificate whenever you need to collect the sales taxes.
The businesses need to collect the sales taxes for each state where there is a nexus. On the contrary, the Canadian sellers or resellers are exempted from the PST/QST by filling the form on the Canadian government website.
How Do I Start An Online Business In Canada?
Determining Business Type
When starting an online business in Canada, they have to determine the business type. For instance, you need to consider if the businesses will be completely online or if it will be a mix of in-store and online business.
In addition, you need to consider if you are shipping the products or offering the services.
Secondly, the business owners need to consider different online business models, which include eCommerce, combo business, business website, third-party business, or blog. The online business model depends on the basic business idea.
Developing The Business Plan
When trying to build an online business in Canada, you have to develop a business plan.
This is because the business plan offers insights and an action plan. The business plan should cover every aspect of business, inclusive of future projections and forecasts. The business plan should outline the marketing, promotional, and operational plans.
Logo & Domain Name
Now that you’ve created the business plan, you need to register the domain name.
Registering the domain name will ensure that you score a name on the web. You need to choose the domain name that your customers can remember and identify. You can consult GoDaddy to check the domain names and see the available options. When the domain name is registered, you can start with logo creation.
Read More: Shopify vs Godaddy
Website Development & Hosting
When the domain name is registered, online business owners need to develop the website on Shopify and make it accessible for the target audience to check out the products.
The website development phase can be expensive, so do your math for it. You should first determine how much it would cost to develop a website on your own or how much to pay someone to build a Shopify website for you.
Generally, website development costs range from $2,500 to $15,000, depending on the website features.
When the website is ready, it can be connected to the domain name, but you will need to work on hosting them. We suggest that you opt for GoDaddy for hosting.
Online Presence Through Social Media
The web is saturated, and you need to promote the website, and nothing can be better than social media for this purpose.
An online presence can be improved by promoting the website and products on social media platforms, such as Facebook, Twitter, LinkedIn, and Instagram. However, the promotion must be natural yet captivating.
Can I Start An Online Business On Shopify Without Registering It In Canada?
Whenever you have to start an online business in Canada, you have to register it, irrespective of the fact that it will be on Shopify or not.
However, before you set up the Shopify store, you will need to look for the availability of the store name. In addition to registering, business owners need to incorporate the store name before starting the online business operations.
How Much Can An Online Store Business Make Before Paying Taxes In Canada?
Generally, people need to file annual returns and pay the tax on a quarterly basis. On average, the online store business has to file the returns only if they are earning $400 or more.
In particular, the online stores in Canada need to pay $1.58 for every $100 earned.
The tax returns can be maximum of $889.54 on an annual basis. However, before you pay the taxes, you have to deduct the business expenses.
Do I Need A Business License To Sell On Shopify In Canada?
Yes, you do need a business license to sell on Shopify in Canada. All the businesses in Canada need a business license, irrespective of the fact that the business is in-store or online.
With business licenses, the government is able to track the operating costs of the enterprises and keep a tab on tax revenues.
How To Register GST For Online Selling In Canada?
GST is essential to be registered if you want to operate an online store in Canada. The registration process usually depends on the business type. Before you apply for registration, you have to be mindful of the fiscal year. In the case of a new online business, you will need to provide personal information, basic business information, such as business name, type of business, and name of owners.
In addition, the businesses need to provide the mailing address and physical address along with major business activities and their description. Businesses can register the GST for online selling in Canada through telephone, fax, mail, and online.
What Is The Average Cost To Build An eCommerce Website On Shopify In Canada?
If you choose Shopify to create the online eCommerce website, the costs will range from $1,000 to $10,000, depending on the features. In addition, the costs will differ/fluctuate with integrations, third-party payment systems, and other factors.
FAQs about do you need a business license to sell online in Canada
What are the high-demand products in Canada to sell online?
In Canada, online high-demand products include smart pills, detox tea, snack subscription boxes, graphic socks, pet care products, sleep aids, baby products, and sporting products.
How much does it cost to maintain a website monthly?
The maintenance costs of the eCommerce website range from $300 to $1,000 on a monthly basis. In the case of large-scale eCommerce websites, the annual costs might spike up to $500,000.
How much do online store business owners make in Canada?
The monthly revenues of the online store businesses cost up to $150,000. However, these are average costs and don’t apply to new or small-scale businesses.
What’s the cost of Folio3 Shopify App Development Services in Canada?
There is no fixed cost for our Shopify app development services since the final cost will depend upon the app’s size, features, complexities, and other aspects. Generally, we offer highly competitive pricing for Shopify app development without compromising on quality standards.
Folio3 offers comprehensive web design services for Shopify stores. Our Shopify experts can help you design the most appealing, and professional-looking online store to give you a competitive edge.
Do Folio3 offer Shopify Migration Services?
Yes. Folio3 Shopify migration services in Canada have helped hundreds of stores to successfully migrate from other platforms. Our seamless and proven migration process ensures minimum business disruption to business operations.
Do Folio3 offer Shopify integration Services in Canada?
Yes. As a leading Shopify development and customization expert, we offer comprehensive and consistent integration services for Shopify stores.
How do Folio3 Shopify maintenance Services in Canada is priced?
At Folio3 we charge an hourly fee for Shopify store maintenance.