Canada-Business Environment

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Published: 06 Oct 2008 17:36:28 PST

Standards

Domestic framework and international association: Member of ISO, 381 sectors, products.
Member of IEC.
Member of the International Communication Union
Consult the WSSN website

Legal framework

Independence of justice: Judicial power is independent; it plays an important role in the interpretation of the law; it can bring down laws which violate the constitution. The Supreme Court of Canada is the highest judicial body in the country.
The Minister of Justice has a double mandate: he is both Minister of Justice and Public Prosecutor of Canada.
Equal treatment of nationals and foreigners: Canada is a constitutional State. Foreign nationals can benefit from the same treatment as citizens of the country, including in commercial disputes. Canada is considered to be one of the least corrupt countries in the world.
The language of justice: English and French are the two judicial languages of the country.
Having recourse to an interpreter: Thanks to the Charter of Rights and Freedoms, every person has the right to an interpreter for any court appearance in Canada. It would seem, however, that the less demographic importance a minority community has, the more difficult it is for the members of this community to exercise their linguistic rights before the judicial bodies.
Sources of the law and legal similarities: The main source of the law is the constitution of the country, which is made up of different written and non-written acts, customs, judicial decisions and traditions. The judicial system is based on English Common Law, except in Quebec where it is a system of civil law modelled on French law that prevails. The judicial power plays an important role in the interpretation of the law; it can bring down laws which violate the constitution. The Supreme Court of Canada is the highest judicial body in the country.
In Quebec commercial law is modelled on the French CIVIL CODE, whereas commercial law in the English-speaking provinces is extensively inspired by English law.

Intellectual Property

Domestic network and international agreements: The organization responsible for intellectual property in Canada is the Canadian Intellectual Property Office (CIPO).
The Copyright Policy Branch for copyright
The Intellectual Property Institute of Canada (IPIC)

Texts currently applying to patents/brands

Type	Text	Date entered into law	Period of validity	Remarks
Patent	Patents Act	-	20 years

Tax rates

Consumption taxes

Tax rate: 5% tax on goods and services + a variable provincial tax (PST or QST) of 6 to 10%.

In Newfoundland-Labrador, in Nova Scotia and New Brunswick, the provincial sales tax and the GST are replaced by a harmonized sales tax (HST) of 13%.
Reduced tax rate: There are exemptions for basic foodstuffs, pharmaceutical products and education. Insurance companies apply a rate of 9% to all premiums.
Other consumption taxes: The law on excise tax imposes taxes on leaded or unleaded gasoline, diesel fuel and motor vehicles.
Some provinces add other taxes. For further information, consult the Department of Finance website.

Corporate taxes

Tax rate for resident companies: From 21 to 15% between 2008 and 2012
Tax rate on long-term capital gains: Long term capital gains are included in taxable income and are thus subject to the same taxation as company profits.
System governing groups of companies and dividends paid by subsidiaries to their parent companies: Dividends are subjected to a restraint at source at the rate of 15% of their gross amount (5% if the actual beneficiary is a company other than a society, which directly possesses at least 10% of the rights to vote of the company which pays dividends),
Tax rate on branches: The rate of branch profits tax is 25% which may be reduced depending on the tax residence of the corporation and the terms of any tax conventions between Canada and its country of residence.

Individual taxes

Tax rate: from 15 to 29%
Allowable deductions and tax credit: Basic federal personal deductions 9 600 CAD.
Other reductions or allowances: moving expenses, alimony, investments, medical expenses, educational expenses, etc.

Double taxation treaties

Countries with whom a double taxation treaty have been signed: Fiscal treaties between Canada and other countries, status of international negotiations, etc.

Sources of fiscal information

Tax Authorities: Canada Revenue Agency

Accounting rules

Tax year: The calendar tax year begins on 1 January and finishes on 31 December of the same year.
When it starts business, a company may establish a tax year of 12 consecutive months. For example: from 1 June to 31 May.
Accounting standards: Financial accounts in Canada usually include a balance sheet, a profit and loss account, a statement of retained earnings and a cash flow statement.

BALANCE SHEET: 12 pre-determined consecutive months;
1) Assets
2) Liabilities
3) Shareholder balance
Accounting reports: The recommendations in the CICA handbook apply to all Canadian companies. Specific regulations apply to banks, insurance companies and public organizations.
Reporting of financial statements and balance sheets is yearly. Companies listed on the Stock Exchange must provide quarterly financial reports.
Accountancy profession: Accountants : plan, organize and administer accounting systems for individuals or establishments. Financial auditors and accountants are employed by auditing and accounting firms throughout the private and public sectors, or they may be self-employed.

Financial auditors : Financial auditors examine and analyze the accounting and financial records of individuals and establishments to ensure accuracy and compliance with established accounting standards and procedures.
Certification and auditing: DELOITE & TOUCHE