General Partnership Registration in Ontario – Fast & Simple Process

Register your General Partnership in Ontario with Business Ontario. Get expert help with name searches, filings, and more.

What is a General Partnership?

A General Partnership is a type of unincorporated business structure in which two or more people or corporations manage and run a business jointly.

They manage and operate a business together, and equally share profits & losses, and responsibilities. All partners in a General Partnership have unlimited liability. They are personally responsible for the business’s debts and obligations.

Previously in Ontario, General Partnership was known as a “Master Business License “. Now, A General Partnership is called a “Firm Name for A General Partnership” and the classification group of “Master Business License” is now called “Business Name Registration“.

Register Your General Partnership

Basic Features of a General Partnership

No Name Protection: General Partnership is considered an “unincorporated business”. So, the name of a General Partnership Business is not protected in Ontario.

Equal Profits and Losses sharing: Typically, in a General Partnership, all partners share their Profits and losses equally. Otherwise, based on their agreed-upon percentage ownership.

No Legal Entity: A general partnership is not a separate legal entity, meaning its partners are personally liable for its debts and obligations.

Unlimited Liability: Since it is not a separate legal entity, each partner is personally responsible for the business’s debts and obligations even if the actions of other partners.  

Easy to set up: The formation of a General Partnership is relatively simple and inexpensive. To set up a partnership business there are no legal requirements.

No Perpetual Existence: A General Partnership Business may dissolve the cause of any partner death, partner withdraws, or all partners agree to dissolve the business.

Agency Authority: The ability to act on behalf of the General Partnership belongs to each partner. and has the authority to bind all partners to agreements or contracts signed for the business’s use.

Easy Cancellation: A General Partnership registration can be canceled at any time. Its cancellation is also easy and there is no legal obligation to cancel a partnership business.

What is required to form a general partnership?

Agreement Between Partners: At least two individuals or entities must agree to operate a business together with shared responsibilities, profits, and losses. This agreement can be verbal, but it’s highly recommended to draft a partnership agreement to outline the terms, responsibilities, and profit-sharing arrangements.

A unique Business Name: General Partnership must have a business name.  Business names should be unique and not in use in Ontario.

Partnership Agreement (Recommended): Partnership Agreements are not always legally required. But it’s highly recommended to create a formal partnership agreement. This Agreement describes how decisions will be made, how profits and losses will be shared, how disputes will be resolved, and what happens if a partner leaves or the partnership dissolves.

Advantages of a General Partnership

There are three main advantages to forming a partnership:

Skills and resources: A General Partnership allows two or more people to work together. This way every partner brings different skills and resources to the Partnership business.

Easy to Form: A General Partnership is one of the easiest types of business to form. It is not expensive or complicated.

Reduced Taxable Income: Partnership business income is personally taxable. If the partnership suffers a loss, the loss can be used to reduce its taxable income. Thus, the way it’s lowering the income tax payable by the partner.

Disadvantages of a General Partnership

There are also disadvantages to forming a partnership. These include:

Personal liabilities: Every partner is personally responsible for the liabilities of the partnership because the partnership is not considered to be separate from its owners. If the business fails, the partners will be personally responsible for paying all the debts and obligations of the partnership.

Responsible for the actions: Each partner is personally responsible for the actions of the other partners because each partner is an agent for the business.  Consequently, if one of the partners makes a bad business decision or acts negligently which results in the partnership owing a debt, all the other partners are personally responsible for paying it back.

Any time dissolve: Due to the death of a partner, the partnership ends because a partnership is based on the individual partners, and it is not a separate legal entity.

Not sellable: A partnership business can not buy or sell because a partnership is not a separate legal entity. Buying or selling a partnership interest will involve rewriting the partnership agreement and determining exactly how the partnership will change. Although the resolution of disagreements among partners is generally covered under a partnership agreement or case law, it can be very difficult. No act exists which sets out rules for settling partnership disputes. If the disagreements are not resolved by the partners themselves.

What is a General Partnership Agreement?

A contract between partners in a General partnership Business is called a partnership agreement. It describes a roadmap for how the business will operate. Also includes detailing the responsibilities, rights, & duties of each partner, as well as how profits, losses, and decision-making will be handled.

Key Elements of a Partnership Agreement:

• The name of the partnership and describe the nature and purpose of the business.
• how much capital or assets each partner contributes to the business, whether in the form of cash, property, or services.
• It describes how profits and losses will be distributed among the partners
• It defines the specific duties and obligations of each partner
• It also describes how decisions will be made within the partnership, whether by majority vote, unanimous agreement, or some other method.
• It provides procedures for resolving conflicts or disagreements between partners
• It describes the process for adding a new partner or handling the withdrawal, retirement, or expulsion of a partner,
• It also specifies the dissolution and Duration of the Partnership

How to register a General Partnership

The process of registering a General Partnership depends on location, but the general steps are similar.

Steps to Register a General Partnership:

Choose a Business Name: First, partners need to decide on a unique name for the partnership Business.

Conduct a Business Name Search: To conduct a business name search you can take help from our Nuans Pre-search service. This business search ensures the business name is not already in use in Ontario.

Register with Provincial Authorities: Register the business name through Service Ontario via Business Ontario online, paying the required fee. We are an official intermediary of service in Ontario.

Collect Business Number: Apply for a Business Number (BN) with the Canada Revenue Agency (CRA) for tax reporting and to handle other federal tax obligations.

General Partnership Act Ontario

General Partnerships are regulated in Ontario by the Partnerships Act, R.S.O. 1990, c. P.5.. General Partnership Act in Ontario refers to the legal framework under which General Partnerships are governed.

Can I Register a General Partnership Federally?

No, you cannot register a General Partnership federally because General Partnerships are typically governed by provincial Acts, not by federal law.

The federal government typically handles the regulation of Federal corporations. General Partnerships are a provincial in (Canada) matter because business regulations differ from one jurisdiction to another. Each province has its own rules and processes for registering partnerships, that’s why they are considered domestic business entities.

General partnership vs. incorporation

General Partnership: This business structure is suitable for those who do not want legal separate entity status with a few owners who trust each other and want to run a business.

Incorporation This business structure is suitable for those who want legal separate entity status and have plans to grow, raise capital, limit personal liability, and require a more formal structure.

How do I choose between a General Partnership and a Limited Partnership?

General Partnership: Choose this. If you and your partners are comfortable sharing full responsibility for the business, then choose this Business structure. You also keep in mind it is an equal say in management and prefer a simple structure with minimal legal formalities.

Limited Partnership: Choose this business if you need outside investors who prefer limited liability and don’t want to be involved in day-to-day operations, and you’re willing to deal with more legal complexity to protect them from risk.

How fast can you register your General Partnership?

You can register a General Partnership with Service Ontario online if you have legal and deep business knowledge. Standard processing is usually completed in 2 to 5 business days. But with Business Ontario we offer expedited service that is available for quicker registration usually less than 1 business hour.

How Business Ontario Corporate Services Inc. can help to register General partnership in Ontario

Business Name Search and Registration: Business Ontario Corporate Services Inc. helps you to ensure that your chosen General Partnership business name is unique and not already in use by conducting a NUANS name search. we offer unlimited name searches for all business registration services.

Filing the Registration Forms: We take care of the entire paperwork process and ensure that all necessary registration documents are filled out properly. We file the required forms through our partner portal account with Service Ontario that make sure that you meet Ontario’s legal requirements for General Partnership.

Online, In-Person, or Expedited Service: We offer different options for registration, including online, in-person, or even expedited registration for those who need their partnership registered faster.

Consultation and Guidance: We provide helpful advice on the registration process and answer any questions about how to structure your partnership, what legal obligations you have, and what ongoing requirements you need to follow in Ontario.

We also advise you on whether a General Partnership is the best structure for your business or if another structure like a Limited Partnership might suit your needs better.

Post-Registration Support: Our task is not done After registering your General Partnership like another provider. We provide ongoing support with compliance requirements, such as renewing the business name registration (which must be renewed every 5 years in Ontario) and filing any updates if partners change.

Frequently Asked Questions (FAQs) related to registering a General Partnership in Ontario

Why should I register my General Partnership in Ontario?

Registering your General Partnership in Ontario recognized that your business is allowed legally to operate your business. It also helps access to certain government programs and ensures compliance with local tax and business regulations.

What is required to register a General Partnership?

To register your General Partnership, you will need:

• Name of the General partnership business.
• First and last names and addresses of all General partners.
• Business Physical office address
• Primary Business activity.
• Government registration fees.

How long is the registration valid, and when should I renew it?

In Ontario, General Partnership registrations are typically valid for 5 years. You will need to renew the registration before it expires. Business Ontario Corporate Services Inc. can assist with reminders and the renewal process. To renew a General partnership government gives 60 day grace period. If you do not renew your Partnership it will automatically cancel.

Can I add or remove partners after registering the General Partnership?

Yes, you can add or remove partners after the partnership has been registered. However, you may need to file an update with Service Ontario to reflect the changes. Click here to add or remove a partner.

How long does it take to register a General Partnership through Business Ontario Corporate Services Inc.?

The time frame depends on the registration method:

• In-person or mail registration can take 5 to 10 business days.
• Online registration typically takes 1 to 3 business days.
• Expedited registration is available for an additional fee and can be completed in 1 business hour.

What if I want to dissolve the General Partnership?

If you decide to dissolve the General Partnership, you will need to formally notify Service Ontario.  Business Ontario Corporate Services Inc. can assist you in canceling your General Partnership.

What are the tax obligations of a General Partnership?

General Partnerships are not taxed as separate entities. Instead, profits and losses are passed through to the partners, who report them on their personal tax return.

How can I contact Business Ontario Corporate Services Inc.?

You can contact Business Ontario Corporate Services Inc. through our website, phone, or email for assistance with registering your General Partnership.