Register a general or limited partnership

General, limited and limited liability partnerships

Canadian provinces recognize three main kinds of partnership. None of them is a separate legal person in the way a corporation is: the partnership's income is generally taxed in the hands of the partners, and liability depends on the kind of partnership and the role of each partner.

In Quebec, the Civil Code uses its own vocabulary: a general partnership is a société en nom collectif (SENC), a limited partnership is a société en commandite (SEC), and professionals may practise within a limited liability general partnership (SENCRL) where their order allows it. The limited liability partnership is available in other provinces under their partnership statutes, and the professions that may use it vary.

Registering the partnership name

Partnership registration is provincial and territorial; there is no federal partnership registry. The registration discloses the partnership's name, its address, its activity and its partners, and it is generally searchable by the public. The rules we have verified:

• Quebec: General and limited partnerships formed in Québec must registersource. Fee: $63 ($94.50 priority)source.
• Prince Edward Island: deadline to register: Within three months of formingsource.
• British Columbia: No B.C. residency requiredsource to register a sole proprietorship or general partnership.
• Elsewhere: a general partnership operating under a name usually registers it under the province's business names or partnerships statute; a limited partnership or LLP always files a declaration with the registry.

A few practical points apply almost everywhere. The name must not suggest the business is incorporated, so it cannot end in Inc. or Ltd. A limited partnership's name usually has to signal its status, for example with "Limited Partnership" or "LP", and an LLP's name with "LLP" or the province's equivalent. In Quebec, the name of a partnership must comply with the Charter of the French Language. Registration does not give exclusive rights to the name: brand protection comes from a trademark.

Registering a partnership in Quebec

In Quebec, partnerships register with the enterprise register under the Act respecting the legal publicity of enterprises: General and limited partnerships formed in Québec must registersource. The registration declaration lists the partners, the address, the activity and, for a limited partnership, which partners are general partners. The partnership receives a Quebec enterprise number (NEQNEQNumber assigned by Quebec’s enterprise registrar on registration. Separate from the federal business number (BN).See definition →) and files an annual updating declaration afterwards. A limited partnership deserves particular care: until its declaration is filed, limited partners may not benefit from the protection the form is meant to give them.

Partnership agreement

Provincial partnership statutes contain default rules that apply when partners have not agreed otherwise, such as equal sharing of profits and losses, and dissolution when a partner leaves or dies in some provinces. Those defaults rarely match what partners actually intend. A written partnership agreement replaces them with the partners' own rules.

• Contributions: what each partner brings in cash, property, skills or clients, and how it is valued.
• Profits and losses: how they are shared and when partners can draw on them.
• Decisions: which ones need unanimity, a majority or a single managing partner, and signing authority.
• Work and non-competition: time commitment, outside activities and restrictions after leaving.
• New partners and exits: admission, withdrawal, death or disability, and how a departing partner's share is valued and paid.
• Disputes and dissolution: mediation or arbitration, and how assets and liabilities are divided at the end.

Lawyer for a partnership agreement: when to involve one

Incorpo is not a law firm and does not draft agreements tailored to your situation. A standard template can work as a starting point for two partners with simple, equal roles. Partners often turn to a lawyer when the stakes are higher: unequal contributions, a limited partnership with outside investors, an LLP in a regulated profession, real estate or significant debt, partners in different provinces, or an exit formula that has to hold up years later.

Government fees to register a partnership (sourced)

• Saskatchewan: $255 (LP/LLP)source.
• Manitoba, general partnership: $60source; limited partnership: $350source; LLP: $350source.
• New Brunswick, general partnership: $112source; limited partnership: $212source; LLP: $112source.
• Nova Scotia, general partnership: $68.55 registration, $68.55 annual renewalsource; limited partnership: $199.35 registrationsource; LLP: $311.45 registrationsource.
• Newfoundland and Labrador, LLP: $300source.
• Yukon, general partnership: $25source; limited partnership: $300source; LLP: $200source.
• Northwest Territories, general partnership: $50 (name reserved) or $75 (name not reserved)source; limited partnership: $300 (name reserved)source; LLP: $300source.
• Nunavut, general partnership: $50source; limited partnership: $200source.

Prince Edward Island's registration fee for partnerships and Ontario's renewal rules for general partnerships are being verified. Renewal periods differ by province, and some limited partnerships also file an annual renewal: in Ontario, $210 (late renewal $360)source.

After registration: keeping the partnership in good standing

Partnership or corporation?

Partners who want to work together have two main options: a partnership, or a corporation in which each holds shares, often with a shareholders' agreement. A partnership is cheaper to set up and income flows directly to the partners, but general partners are personally liable for the partnership's debts. A corporation shields shareholders' personal assets in general, files its own tax return and can more easily bring in investors. The right choice depends on liability, tax and the partners' plans, which an accountant and a lawyer can assess together.

How Incorpo registers your partnership

1. 1Guided questionnaireYou choose the kind of partnership, the province, the name and the partners. We show what that registry requires.
2. 2Name checkWe search the registry for identical or similar names and check the required wording for limited partnerships and LLPs.
3. 3RegistrationWe prepare the registration or declaration, you review it, and we file it with the registry and pay the government fee, shown separately on your quote.
4. 4Agreement and next stepsYou can start from a partnership agreement template or ask for a referral to our partner law firm. We also list the tax registrations that may apply.