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Financing a Business in Canada

Entrepreneurs often report that getting financing is the most challenging aspect of starting a business in Canada or growing a business in Canada. If you are looking for possible funding you should start by researching the different types of financing that are available and assessing which one is best for your needs.

Canadian government grant, loans and financing

For grants and incentives it is essential you visit the governmental Services for Entrepreneurs in Canada, which offers a comprehensive guide of all the aspect you must consider in starting a business and looking for incentives in the country. A powerful search engine browses all the available opportunities, crossing the sector you are in with the location in the country.

All levels of government in Canada offer various levels of grants in order to assist investors in making business investments, but you have more chance to get them in the depressed areas, which are technically ranked as Tier 2 or 3. These incentives take many forms, from investment tax credits to direct cash grants. In certain arrangements with specific foreign governments, businesses from those countries have been given the same status as Canadian businesses in terms of dealing with the Canadian government. Businesses in Tier 1 areas, normally large cities generally receive little or no assistance.

Income tax legislation gives favorable treatment to certain activities or industries.

Research and development, sectoral and regional incentives

Scientific research and experimental development activities undertaken in Canada receive significant tax incentives including a 20 percent investment tax credit on qualified expenditures, as well as a 100 percent write-off of current and capital costs associated therewith. Certain private corporations are eligible for a 35 percent refundable investment tax credit on qualified expenditures, depending on their size and ownership status. Specialized industries such as those engaged in natural resource activities are offered generous write-offs for tax purposes for exploration and development activities. While several provinces offer incentive programs, Quebec offers significant additional incentives to a number of businesses including those involved in scientific research and experimental development.

Public-private partnerships

PPP tenders can be viewed on Merx, a central procurement portal utilised by all levels of government to post public tenders.

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