Entrepreneurship & Small Business

Lawyer wants $2000+ to incorporate a business

  • Last Updated:
  • Jun 9th, 2018 2:17 am
Deal Fanatic
User avatar
Dec 3, 2009
5319 posts
770 upvotes
Toronto
Not a bad idea going with the lawyer at the end. Some lawyers/firms give a package deal if you incorporate with them...i.e. have discounted legal services in your first year. Kind of like a start-up kit.
Remember to be an RFD-er and NOT a degenerate.
Member
Apr 13, 2005
403 posts
200 upvotes
DIY Federal in is only $220 ($200 to the govt + $20 for the NUANS report if it's not a numbered corp give or take $5).

I
Member
Aug 8, 2010
449 posts
45 upvotes
NewJohnny wrote:
May 3rd, 2018 12:01 am
That's just not true. Government fees alone are over $200. Show a cost breakdown.

Anyways, I ended up going with a lawyer after all. Federal incorporation with provincial registration and expedited name search was $1900. Now it's done and I can move on to other things. Thanks for talking me down.
I am not the only one who said this in this forum alone. so the lawyer charge 1780 for one hour of service. (cost 20 for name search).

I also did the same thing: Federal incorporation with provincial registration and expedited name search. grand totoal 200+20
Deal Guru
Aug 2, 2010
13204 posts
3416 upvotes
Here 'n There
A lawyer incurs liability and has overhead (rent, insurance, LSUC fees, staff to pay, office equipment, taxes on income). You don't. Also, if you make a mistake or were unaware of something that could have saved you time and money and future frustration then the first person you'll go crying to is a lawyer to get you out of your incorporation mess.

There is absolutely zero equivalence in your statement.
Member
Aug 8, 2010
449 posts
45 upvotes
eonibm wrote:
May 4th, 2018 9:56 am
A lawyer incurs liability and has overhead (rent, insurance, LSUC fees, staff to pay, office equipment, taxes on income). You don't. Also, if you make a mistake or were unaware of something that could have saved you time and money and future frustration then the first person you'll go crying to is a lawyer to get you out of your incorporation mess.

There is absolutely zero equivalence in your statement.
come on, as a IT consultant (before become perm)I also have rent, insurance, equipment and taxes on income to pay...I assume OP is also the same as developer...ask him how much he charge per hour as a developer?

If you are going to earn lots of money for your corporation, then 2k is nothing. I would say go for it. but as a small business? It is a very straight forward process...experienced people probably takes 15 minutes.
Deal Guru
Aug 2, 2010
13204 posts
3416 upvotes
Here 'n There
1000islands wrote:
May 4th, 2018 8:08 pm
come on, as a IT consultant (before become perm)I also have rent, insurance, equipment and taxes on income to pay...I assume OP is also the same as developer...ask him how much he charge per hour as a developer?

If you are going to earn lots of money for your corporation, then 2k is nothing. I would say go for it. but as a small business? It is a very straight forward process...experienced people probably takes 15 minutes.
come on, If it was so cheap and easy for a lawyer to do it then competition would have driven the price down.

Think about it.
Deal Guru
Aug 2, 2010
13204 posts
3416 upvotes
Here 'n There
1000islands wrote:
May 4th, 2018 8:08 pm
come on, as a IT consultant (before become perm)I also have rent, insurance, equipment and taxes on income to pay...I assume OP is also the same as developer...ask him how much he charge per hour as a developer?

If you are going to earn lots of money for your corporation, then 2k is nothing. I would say go for it. but as a small business? It is a very straight forward process...experienced people probably takes 15 minutes.
come on, If it was so cheap and easy for a lawyer to do it then competition would have driven the price down.

Think about it, why don't you...
Deal Addict
Sep 23, 2007
4446 posts
791 upvotes
If it's a simple 1 shareholder corporation, then there's no reason not to do it yourself. There is some value to having a lawyer do it when you have a complicated structure with more than 1 person and want the legal advice associated with that.
Sr. Member
Feb 1, 2010
871 posts
173 upvotes
Can anyone add the yearly and ongoing costs? Are there yearly filings needed? Yearly taxes? Are these easily DIY too? How much for annual lawyer and tax fees?
Deal Addict
User avatar
Dec 10, 2004
4820 posts
858 upvotes
Thornhill
Lawyers charge 350-500/h on average so if they charge you $2000 then it should be 3-4 hours of work. If not, find a lawyer with hourly fees and they would do it.
[OP]
Newbie
Nov 2, 2010
9 posts
Vancouver
My lawyer told me about $300 annual fee for filing. My accountant also charges about $300 for a basic year-end tax filing.
Newbie
Oct 8, 2010
94 posts
15 upvotes
Another option would be to check out https://www.founded.co/pricing Toronto based startup

$360 for the basic incorporation plus disbursements $300.

There are other levels of service too if anyone out there is looking for shareholder agreements, vesting schedules, multiple partners etc, it's a unique way to get it done quickly. I had a cam chat with Derek (one of the founders) who has a law background and answered a lot of my questions thoroughly. I've used this platform to incorporate a few businesses I invested in with some associates and happy so far.

I don't mind paying the fee as my time is more valuable but incorporations can get complex when you have multiple people and vesting schedules. People who have the time to invest, I would suggest learning how to incorporate especially if you are solo.
Deal Expert
Mar 23, 2009
16154 posts
3317 upvotes
Toronto
I paid $3000 (all in) for my incorporation. I knew that was expensive, but went with them anyway since my colleagues liked the firm and that particular lawyer, plus she knew my accountant well and had a good relationship with him. I have to say, that person was extremely professional, which isn't a surprise, since she was a specialist in corporate law. Was it worth paying $1000 more than some others? I dunno, but whatever. I didn't want to go to general practice lawyer though. I'd rather stick to a specialists with a good reputation.

Similarly, I went to a real estate lawyer for my home purchases. One neighbour of mine went to a general practice lawyer for her home purchase and got royally screwed over because the guy wasn't well versed in the nuances of the Toronto condo townhouse market.
Member
Feb 8, 2017
404 posts
182 upvotes
EugW wrote:
May 19th, 2018 3:03 pm
I paid $3000 (all in) for my incorporation. I knew that was expensive, but went with them anyway since my colleagues liked the firm and that particular lawyer, plus she knew my accountant well and had a good relationship with him. I have to say, that person was extremely professional, which isn't a surprise, since she was a specialist in corporate law. Was it worth paying $1000 more than some others? I dunno, but whatever. I didn't want to go to general practice lawyer though. I'd rather stick to a specialists with a good reputation.

Similarly, I went to a real estate lawyer for my home purchases. One neighbour of mine went to a general practice lawyer for her home purchase and got royally screwed over because the guy wasn't well versed in the nuances of the Toronto condo townhouse market.
if you got the result you wanted without any headaches then you are happy. if you are happy then it was a good price! nothing worse than looking for a deal and then having to end paying more in the end to fix crap. lawyers are like any other profession - there are good ones and bad ones.
Newbie
May 22, 2018
4 posts
2 upvotes
Toronto
I agree.
Dont do it yourself for $500. Its not worth it. If your business grows, you will have to pay a lawyer at least $2000 to fix what you did yourself on the internet. The internet incorporations do not allow you to create various classes of shares for income splitting purposes or rollover shares for tax planning purposes.
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