Business Tax ID Number in Canada

Sep 6, 2023

 

The tax ID number (also called a Business Number) is part of the 15-character program account number assigned to your business by the Canada Revenue Agency (CRA). The program account number consists of three parts:

  • Nine-digit Business Number (BN) that identifies your business 
  • Two-letter identifier for the program type 
  • Four-digit reference number for the program account 

An account number would look like this: 123456789 RT0001

Your Business Number functions as your business tax identification number, as that is its purpose. When you initially register for any of the four main program accounts needed to operate your business – Goods and Service Tax (GST)/Harmonized Sales Tax (HST), Payroll deductions, Import/export privileges, and Corporate income tax – the CRA will assign you a Business Number. The nine-digit tax ID number (Business Number) remains the same for all program accounts. However, the program ID and account numbers will vary depending on the specific program. To obtain your Business Number, you can apply through The Canada Revenue Agency’s Business Registration Online service.

Please bear in mind that in Quebec, the Business Number does not include your GST/HST accounts. To have GST/HST accounts included, you need to register for a separate account with Revenu Québec. Additional clarification can be found in the document titled “General Information Concerning the QST and the GST/HST” by Revenu Québec.

If applicable, other tax accounts such as Excise Tax will also require a tax ID number/Business Number.

 

Does Every Business in Canada Need a Tax ID Number?

If your small-scale enterprise doesn’t require any of the tax accounts mentioned earlier (meaning you qualify as a Small Supplier for the GST/HST and are not obligated to register for it), then there is no need for your small business to have a Business Number.

Regarding businesses, the CRA defines a small supplier as one whose total taxable revenues (prior to expenses) from all their business activities amount to $30,000 or less over the past four consecutive calendar quarters, as well as any single calendar quarter.

 

Is it necessary to have a distinct number for each of my businesses?

As a sole proprietor managing several businesses and requiring a Business Number, one Business Number can be used for all of them, unless any of those businesses are structured as a partnership, trust, or corporation. In such cases, each entity will require its individual Business Number.

 

Tax ID for Federal Incorporation in Canada

When your business is approved for federal incorporation, Innovation, Science and Economic Development Canada (ISED) will provide you with the Business Number. Before applying for federal incorporation, it’s important to understand the distinction between federal and provincial incorporation. Once you have obtained the Business Number from ISED, you can proceed to apply for any of the taxation identification program accounts mentioned above through the CRA.

 

The Canada Revenue Agency (CRA) has established partnerships with several provinces to collaborate on the utilization of the Business Number. These provinces include:

– British Columbia
– Ontario
– Nova Scotia
– New Brunswick
– Manitoba
– Saskatchewan

In these provinces, the Tax ID number or Business Number serves as the primary identifier for business accounts and is increasingly used for various provincial programs.

After completing the registration process for your Business Number via the Business Registration Online service, you have the option to directly access online provincial business registration services for the following provinces:

– British Columbia: OneStop Business Registry
– Ontario: ServiceOntario – Business Services
– Nova Scotia: Registry of Joint Stock Companies

During this registration process, you can also sign up for other programs simultaneously. For example, when registering online for a Business Number for your Ontario-based business, you have the opportunity to register a business name and additionally enroll in programs such as the Ontario Employer Health Tax and the Ontario Workplace Safety and Insurance Board.

 

CBES is here to assist you; feel free to contact us for expert guidance.

 

 

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