In British Columbia, many healthcare professionals are choosing medical incorporation by creating their practices as medical professional corporations (MPCs). This structure not only offers liability protection and tax efficiency but also boosts professional credibility. However, understanding how to incorporate a medical professional corporation in BC involves navigating legal steps and regulatory requirements.
Physicians, as high-income earners, often face a substantial personal tax burden. Incorporating your practice can offer significant tax advantages, including the ability to defer and reduce personal income taxes—helping you meet long-term financial goals such as repaying medical school debt or purchasing a home. Incorporation can also improve access to financing and credit.
However, it’s important to understand the costs and administrative responsibilities that come with incorporation. Managing a corporation independently can be complex and time-consuming, particularly when your expertise lies in medicine, not law. In addition to your personal tax return, you’ll be required to file a separate corporate tax return. For this reason, we strongly recommend working with an accounting team experienced in medical corporation filings.
Step-by-Step Process on How to Incorporate a Medical Professional Corporation in BC
Step 1: Confirm Eligibility and Licensing
Ensure that each shareholder or director is properly licensed by a relevant regulatory body.
Step 2: Reserve a Unique Corporate Name
Decide on a unique name for your corporation. Validate its availability and work with a lawyer to get approval from the College of Physicians and Surgeons of British Columbia.
Step 3: Obtain consent from the relevant regulatory body.
Once your chosen name is approved by the CPSBC, ensure you pay for any related fees payable to the CPSBC.
Step 4: Design Share Structure and Ownership
Define who owns what, including common vs. preferred shares, and restrictions as required by law.
Step 5: Establish Corporate Bylaws
These rules outline how the corporation will operate, including director roles, voting rights, and meeting procedures.
Step 6: Appoint Directors and Officers
Assign decision-makers who are responsible for corporate compliance and management.
Step 7: Register with the BC Corporate Registry
File all legal documents and obtain your certificate of incorporation and provide the same to CPSBC.
Step 8: Tax Planning and CRA Setup
Register with the Canada Revenue Agency for business numbers, GST/HST, and payroll accounts, if applicable.
Post-Incorporation Considerations
Once the incorporation process is complete, there are several important post-incorporation matters to consider. One of the initial steps is to open a corporate bank account. In doing so, you will also need to issue shares and organize key corporate records. Your lawyer can assist you with these formalities to ensure proper compliance and record-keeping.
You will receive a Canada Revenue Agency (CRA) Business Number upon incorporation, which allows you to register for and access your MyCRA Business Account.
To maintain good standing, ongoing compliance with the CPSBC is essential. This includes fulfilling regular reporting obligations and addressing any continuing post-incorporation requirements. Physicians must also meet professional development standards and ensure the timely renewal of both their medical licence and the corporation’s registration.
Should you require assistance with any documents or filings after incorporation, our office would be pleased to provide support.
How Lime Law Supports Medical Professionals in BC
Lime Law assists healthcare providers with corporate structuring. Our team offers end-to-end support, from incorporation to compliance. We ensure your MPC meets all legal and regulatory obligations.
Frequently Asked Questions (FAQs)
1. Do I need to use a lawyer in order to incorporate?
Unlike most professional service corporations, incorporation with the CPSBC requires a lawyer to sign a certificate as part of the process. Your lawyer will also assist in preparing and submitting the necessary applications and supporting documents to secure your permit to incorporate.
2. How long does the incorporation process take?
The CPSBC may take up to three weeks to approve a medical corporation permit. We will make every effort to expedite the processing of your application. Once the permit is issued, the incorporation process can typically be completed within 48 business hours.
3. What issues might arise if I choose not to incorporate as a doctor?
Without incorporating, physicians often pay significantly more in taxes than necessary. Additionally, access to financing and credit may be more limited.
4. What does the incorporation process look like?
Physicians practising as sole proprietors or in partnership with other established practitioners should consult their accountant or tax advisor to facilitate the transfer of personal business assets into the new corporation. This may involve a Section 85 rollover (a tax-deferred transfer of property), along with assigning leases, contracts, and other legal obligations to the corporation. We will assist with selecting a compliant corporate name and preparing the application for a medical corporation permit from the CPSBC. Once these steps are complete, we will proceed to finalize the incorporation.
5. Can all doctors incorporate in BC?
Yes, all physicians with a valid medical license should be able to incorporate in British Columbia.
Conclusion
When you’re ready to incorporate your medical practice in Canada, Lime Law is here to guide you through the process with clarity and confidence. Our team offers informed, practical legal advice tailored to your profession—helping you safeguard personal assets and accelerate your path to building wealth. Contact us at 604 924 8678 or click here to book a discovery call today to schedule a consultation and learn more.
