To set up a professional corporation in Ontario you must incorporate under the Ontario Business Corporations Act, meet the ownership, naming and business conditions that the Act sets for professional corporations, and obtain a certificate of authorization from the body that regulates your profession before you serve clients through the corporation. A professional corporation gives a regulated professional a corporate structure for their practice, but it never shields you from personal responsibility for your own professional work, and it carries rules that an ordinary business corporation never has to meet.
Insight Law Professional Corporation is itself a professional corporation, and we help doctors, dentists, lawyers, accountants and other regulated professionals across Ontario incorporate their practices the right way. This guide covers who can incorporate, the conditions you have to meet, what it costs, how long it takes and the mistakes we see most often. If you would rather talk it through, a Toronto corporate lawyer on our team is happy to help.
What is a professional corporation in Ontario?
A professional corporation is a corporation that a member of a regulated profession uses to carry on their practice. It is created under the Ontario Business Corporations Act, the same statute behind ordinary business corporations, but it answers to a second layer of rules set by the body that governs the profession. Ontario opened this door on November 1, 2001, when the professional incorporation provisions of the Act came into force, and several professions have been able to incorporate ever since.
The practical difference is simple. A regular corporation can be owned by almost anyone and can carry on almost any lawful business. A professional corporation can only be owned and run by members of one regulated profession, and it can only do the work of that profession. Your regulator can look through the corporation and hold you to the same standards you would face as an individual licensee. If you are still weighing your options, our overview of business structure in Ontario lays them out side by side.
Which professions can incorporate as a professional corporation?
Not every occupation can use this structure. The Act limits professional corporations to professions whose governing statute allows it. In Ontario that includes the regulated health professions, lawyers and paralegals, chartered professional accountants, social workers and social service workers, and veterinarians.
- Regulated health professionals under the Regulated Health Professions Act, including physicians, dentists, nurses, pharmacists, optometrists, chiropractors, psychologists, physiotherapists, dietitians and midwives.
- Lawyers and paralegals licensed by the Law Society of Ontario.
- Chartered professional accountants regulated by CPA Ontario.
- Social workers and social service workers under the Social Work and Social Service Work Act.
- Veterinarians under the Veterinarians Act.
Two groups that people often assume can incorporate this way actually cannot. Professional engineers and architects do not form professional corporations under the Business Corporations Act. They practise through other arrangements set by their own regulators, such as a certificate of authorization from Professional Engineers Ontario or a certificate of practice from the Ontario Association of Architects. In our practice the confusion we see most often comes from professionals who read a generic article, assume their field qualifies, and only learn otherwise when their regulator turns the structure down. Check with your governing body before you spend anything.
What are the requirements to form a professional corporation in Ontario?
The Business Corporations Act sets four core conditions for every professional corporation. Your articles of incorporation have to be drafted to meet them, and your regulator will check them before it issues your certificate of authorization.
- Ownership. Every issued and outstanding share has to be owned, directly or indirectly, by one or more members of the same profession. A pharmacist corporation is owned by pharmacists, a law corporation by lawyers, and so on.
- Directors and officers. Everyone who serves as a director or officer has to be a shareholder, which in turn means they have to be a member of the profession.
- Name. The name has to include the words Professional Corporation or the French societe professionnelle, has to follow the naming rules of your governing body, and cannot be a numbered company. Most regulators require the professional’s own name to appear, for example Jane Smith Dentistry Professional Corporation.
- Business restriction. The articles have to limit the corporation to practising the profession and to activities related to or ancillary to that practice, which includes investing the surplus funds the corporation earns.
Two smaller points trip people up. A voting agreement or proxy that hands your voting rights to someone who is not a shareholder is void, and a unanimous shareholder agreement is void unless every shareholder is a member of the profession. Getting the wording of these restrictions right in your articles of incorporation matters, because a regulator will reject articles that do not track the statute.
What is a certificate of authorization, and why can you not practise without one?
Incorporating is only half the job. Before you can serve a single client through the corporation, you need a certificate of authorization from your regulator. It is the document that confirms your corporation meets the Act and your profession’s rules, and without it the corporation is not allowed to practise.
You apply after the corporation exists, not before. Each regulator runs its own process and sets its own fee.
Does a professional corporation protect you from liability?
This is the question we get most, and the answer surprises people. A professional corporation does not protect you from your own professional negligence. The Business Corporations Act says plainly that incorporating does not limit a member’s professional liability. If a client sues over the work, you remain personally on the hook, and so does your corporation.
What incorporation does limit is ordinary business liability, the same way any corporation does. If the corporation signs a lease or a supplier contract and cannot pay, your exposure is generally limited to what you put into the company, not your home. That is a real benefit, but it is not malpractice protection. This is exactly why your regulator still requires you to carry professional liability insurance after you incorporate. The corporate wrapper changes how you are taxed and how you hold the business, not whether you answer for your own work.
How is a professional corporation different from a regular corporation?
Here is how the two structures compare on the points that matter most to a practising professional.
| Feature | Regular business corporation | Professional corporation |
|---|---|---|
| Who can own shares | Almost anyone, including family and outside investors | Only members of the same profession, with limited family exceptions for physicians and dentists |
| Directors and officers | Do not need to be shareholders | Must be shareholders and members of the profession |
| Name | Can be a numbered company or a brand name | Must include Professional Corporation, cannot be numbered, and usually includes your name |
| What it can do | Almost any lawful business | Only the practice of the profession plus ancillary activities |
| Professional negligence | Not applicable | You remain personally liable, with no shield from the corporation |
| Regulator approval | None | Certificate of authorization required before you practise |
| Annual upkeep | Annual return and minute book | Annual return, minute book, certificate renewal and insurance |
How much does it cost to set up a professional corporation in Ontario?
Setting up a professional corporation has government costs, regulator costs and professional costs. The government and regulator amounts below are current as of 2026, and you should confirm them before you file, because fees change.
| Item | Typical cost | Notes |
|---|---|---|
| Articles of incorporation, Ontario Business Registry | 300 dollars | Government filing fee for electronic filing |
| Name search (NUANS) | About 30 to 75 dollars | Needed because a professional corporation cannot be numbered, valid 90 days, price varies by provider |
| Certificate of authorization (lawyers shown) | About 250 dollars plus HST | Set by your regulator and differs by profession |
| Annual certificate renewal (lawyers shown) | About 100 dollars plus HST | Charged every year by your regulator |
| Legal fee to set it up properly | Fixed fee, confirmed up front | Drafting compliant articles, organizing the corporation and the minute book |
| Accounting and tax setup | Varies | Speak with your accountant about bookkeeping and corporate tax returns |
We quote a fixed fee for professional incorporation so you know the legal cost before any work starts, and the first conversation is free. Booking a free consultation is the simplest way to get a number for your situation. You can also read our general guidance on business incorporation in Ontario.
What does the process look like, and how long does it take?
Here is the path we take a client through, and roughly how long each part takes. The whole process usually runs a few weeks, most of which is waiting on the regulator.
- Confirm the structure. We check that your profession qualifies, that a professional corporation makes sense next to options like a sole proprietorship, and how your shares should be set up. Usually a few days.
- Clear a name. Because the corporation cannot be numbered, you choose a compliant name and we run a NUANS search to confirm it is available. One to three days.
- File the articles. We prepare and file articles of incorporation under the Business Corporations Act with the share and business restrictions your profession requires. Electronic filing is often back the same day.
- Organize the corporation. We prepare the minute book, bylaws, first resolutions, share certificates, the share and director registers, and your register of individuals with significant control. About a week.
- Apply for the certificate of authorization. We submit the application to your regulator. You wait for the certificate to be issued before you serve any client through the corporation, and that timeline is set by the regulator, not by us.
- Switch over. You open corporate banking, set up HST and payroll if you need them, move your billing into the corporation and tell your regulator about the structure.
The order matters. The corporation has to exist before you can apply for the certificate, and the certificate has to be in hand before you practise through the company.
Can you add family members as shareholders or split income?
Many professionals incorporate hoping to split income with a spouse or adult children. For most professions that is not allowed, because every shareholder has to be a member of the same profession. There is a narrow exception. Since January 1, 2006, physician and dentist corporations have been able to issue shares that carry no vote to certain family members, meaning a spouse, a child or a parent of a voting shareholder who is a member of the profession.
Even where family shares are allowed, federal tax rules on splitting income with family members limit the benefit in many cases. Whether incorporating saves you tax depends on how much you earn, how much you leave in the corporation and your personal situation, so this is a question for your accountant as much as your lawyer. We are happy to coordinate with your tax advisor on the structure.
What ongoing obligations does a professional corporation have?
A professional corporation needs upkeep on two fronts, the corporate registry and your regulator. Letting either slide can cost you the right to practise through the company.
- File your annual return through the Ontario Business Registry and keep your corporate information current. If something changes, you have to update the registry within 15 days.
- Keep a proper minute book and maintain your register of individuals with significant control.
- Renew your certificate of authorization on your regulator’s schedule and pay the renewal fee on time.
- Keep the professional liability insurance your governing body requires.
- Update your articles, name, addresses, directors and shareholders whenever they change, and stay in good standing with both the registry and the regulator.
If you fall out of compliance you can face penalties, and your regulator can revoke the certificate that lets the corporation practise. Staying current is far cheaper than fixing a lapse.
What mistakes do professionals make when setting up a professional corporation?
Across the professional incorporations we handle, the same avoidable mistakes come up again and again.
- Practising through the corporation before the certificate of authorization is issued. The corporation exists, the billing starts, and the regulator has not approved anything yet. Fixing that after the fact is painful.
- Believing the corporation shields them from malpractice claims. It does not, and acting as if it does can leave you underinsured.
- Using generic or wrong wording for the share and business restrictions in the articles, which leads the regulator to reject the application.
- Trying to add family members as shareholders where the profession does not allow it.
- Missing the annual renewal window and losing the corporation’s right to practise until it is sorted out.
- Treating the corporation like a numbered company, which a professional corporation is never allowed to be.
“Incorporating changes how you are taxed and how you hold your practice. It does not change the fact that you answer personally for your own professional work.”
Demet Altunbulakli, Founding Lawyer, Insight Law Professional Corporation
Frequently asked questions
Do I have to incorporate to practise my profession in Ontario?
No. Incorporating is optional. You can practise as a sole proprietor, in a partnership, or through a professional corporation. A professional corporation is mainly a tax and structure decision, not a licensing requirement. Whether it is worth it depends on your income and goals, which is worth talking through with a lawyer and an accountant. You can compare it with running a sole proprietorship first.
Can two professionals from different fields share one professional corporation?
Generally no. Every shareholder of a professional corporation has to belong to the same profession, so you cannot mix, for example, a dentist and an accountant in one professional corporation. Professionals who want to combine forces across fields usually look at other structures and should get advice on what fits.
Is a professional corporation the same as a limited liability partnership?
No. A professional corporation is a corporation that one professional, or members of the same profession, bill their work through. A limited liability partnership is a partnership between two or more partners that limits each partner’s exposure to the negligence of the others. Larger firms often prefer an LLP, while solo and small practices often prefer a corporation. You can read more about the limited liability partnership option.
Will incorporating lower my taxes?
It can, but it depends. The main benefit is tax deferral, leaving income in the corporation at the lower corporate rate and drawing it out later. How much that helps depends on how much you earn, how much you need to live on and how much you can leave inside the company. Federal rules also limit splitting income with family. This is a question for your accountant, and the straightforward answer for many professionals is that it only pays off above a certain income.
What happens to my professional corporation if I stop practising or retire?
You cannot keep operating a professional corporation once you are no longer a licensed member. When you retire or leave the profession you generally have to wind the practice down, which can mean amending the articles to remove the professional restrictions, changing the name and surrendering the certificate of authorization. Plan this with your lawyer well before your last day of practice.
How long is a certificate of authorization valid?
It stays valid as long as you renew it on schedule and stay compliant. For lawyers, the Law Society requires annual renewal by December 31. Other regulators set their own renewal cycles, so confirm the deadline with your governing body and put it in your calendar, because a missed renewal can suspend the corporation’s right to practise.
The information provided above is of a general nature and should not be considered legal advice. Every transaction or circumstance is unique, and obtaining specific legal advice is necessary to address your particular requirements. Therefore, if you have any legal questions, it is recommended that you consult with a lawyer.
