Limited Partnership in Ontario, Canada
Full tax-exempt Canadian entity
However, Canadian legislation does offer the opportunity of registering and using Canadian enterprises with a zero rate of tax. These are known as Limited Partnerships. The L.P. is a limited partnership that has no less than two partners. One of the partners is a General Partner, whilst the other partners have the status of Limited Partners.
A Canadian L.P. with foreign members, which does not carry on a business in Canada and derives no income on Canadian territory, is not liable to tax in Canada. According to the Canadian tax laws, the L.P. is not considered as the separate subject of taxation. It is the founders (“Partners”) who should pay taxes from the profits received by the L.P. company in the place of their residence, in proportions according to the shares of interests belonging to them in the L.P. company, if it is stipulated by the legislation of that particular country.
Ontario LP registration for non-residents
Limited Partnership is a simple form of business registration in Canada, which creates a Canadian company and does not generate filing and tax obligations in Canada for partners, who are not residents of Canada.
This form of business registration is extremely popular among software developers, web programmers, computer support specialists and IT service providers, who offer services to customers in Canada, the US and Europe.
TBA offers registration of Limited Partnerships in Ontario, Canada for non-Canadian residents.
Each Limited Partnership is required to have a legal name. The name must include a legal element, such as “Limited Partnership” or “LP”.
LP name cannot include a last name or a distinctive corporate name unless it is the last name or corporate name of one of the general partners.
The name of a Limited Partnership may be in English form, French form or both.
The name cannot include restricted words, such as “bank”, “trust”, “insurance”, “stock exchange”, “university”, “academy” , etc.
Time required for registration
TBA registers a LP in Canada, Ontario, in 1 to 3 business days.
- A minimum of one general partner is required, who may be a residents of any country.
- Corporate general partners are permitted. If a corporation is incorporated outside of Canada, it must be registered in Ontario as Extra-Provincial Corporation before it becomes a general partner.
- Each limited partnership must have a minimum of one limited partner, who may be an individual or legal entity.
- No Canadian residency is required.
- When a non-Canadian corporation is a limited partner, extra-provincial registration of the corporation in Ontario is not required.
- A person may be a general partner and a limited partner at the same time in the same limited partnership. Therefore, just one person is needed for registration of limited partnership.
Share capital – contributions
- There are no minimum or maximum amount of contribution is required; however it is usual to declare Standard authorised capital – CAD 1.000.
- Partners may contribute money and other property to the limited partnership, but not services.
- Interest of a partner in the limited partnerships is considered as a personal property.
- General partners have unlimited personal liabilities for debts and obligations of the limited partnership.
- Liability of the limited partners is restricted by the size of their contributions into the limited partnerships.
Annual general meeting
Address of principal place of business
Our company provides Ontario address to its clients and maintains all records for clients limited partnerships. The address also accepts letters from the Ontario government.
When a client would like to receive letters sent by his banks, customers and suppliers at the Ontario address, he has to order our virtual office services.
Beneficial ownership information
Advantages of Ontario LP
- Highly prestigious Canadian company.
- No restrictions on the residency of partners.
- Availability of one-man limited partnership, when one person is a sole general and limited partner.
- There is no minimum authorized capital. Partners can make any contribution to the limited partnership.
- No withholding tax on profit received by partners outside of Canada.
- No requirements to file corporate tax returns.
- No corporate income tax.
Common use of Limited Partnership
- Regular trading company for doing business in Canada, US, EU and other highly regulated jurisdictions;
- Agent working under Sales Agency Agreement (Principal may be any legal entity including companies registered in low and zero tax jurisdictions);
- Software development and IT support services, when major customers are located in Canada, US and EU;
- Online based businesses (website development, marketing services, auctions, webstores, etc.).
Limited Partnership is not considered as a taxable entity. Therefore, LP is not required to file corporate tax returns and pay income taxes.
All profit received by Limited Partnership passes through the company to its partners. Partners, who are not Canadian residents, do not have tax liabilities in Canada. If a partner is a Canadian resident, he is required to include his part of profit received through his Limited Partnership into his personal tax return and pay personal income tax.
There is no withholding tax on the profit passed to partners, who are non-Canadian residents.
There are no audit requirements for Limited Partnerships.
Canada LP filing of financial statements
Every Canadian L.P. must keep appropriate accounting records, and prepare a Financial Statement annually. Corporate Taxation Canada L.P. companies with non-resident partners which have no business activities in Canada; do not derive any income from Canada sources, and are managed and controlled outside of Canada, are exempt from Canada Federal and Provincial corporation taxes.
Canada tax treaties
Canada L.P. companies are not regarded as resident for tax purposes in Canada, and therefore are not entitled to take advantage of Double Tax treaties concluded by Canada with other countries.
Our company licensing services
— What we do and do not do
Our company is EXCLUSIVELY engaged in assisting worldwide clients, either individuals or corporate entities, to get duly and properly licensed with local Regulators and Financial Authorities to get respective official licenses to legally carry out their cryptocurrency or financial related business activities.
TBA & Associates Tax Business Advisors does not provide or carry out any sort of Cryptocurrency or Financial services!
Disclaimer: While TBA & Associates strives to make the information on this website as timely and accurate as possible, the information itself is for reference purposes only. You should not substitute the information provided in this article for competent legal advice. Feel free to contact TBA Customer Services for advice on your specific cases.