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Corporate-Commercial Lawyer Toronto & Business Lawyer Toronto

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    Corporate-Commercial Lawyer Toronto & Business Lawyer Toronto

    Kalfa Law is a boutique law firm specializing in corporate-commercial law, business law and tax law in the Greater Toronto Area. Because our business and tax divisions work in tandem with each other, Kalfa Law provides optimally integrative solutions, enabling and ensuring the growth and success of your business.

    Our commercial and tax lawyers pride themselves on executing their responsibilities according to the firm’s founding principles of honesty, integrity, reliability, and value.

    Corporate-Commercial and Business Law

    Our corporate-commercial/business law division serves businesses of every structure, size and industry. Our services include the following:

    Incorporating and Starting a Business

    Our business lawyers guide your business startup and provide comprehensive legal business services including incorporations, partnership agreements, joint venture agreements, and master business licenses.

    Commercial Financing

    Our commercial law division assist businesses in arranging for commercial financing. With our strategic legal advice for both private lenders and borrowers, we seamlessly facilitate financing transactions and advise creditors and debtors.

    Business Restructuring, Amalgamation, and Dissolution

    Our corporate-commercial lawyers assist business start-ups in establishing their corporate structure, including corporations, partnerships, sole proprietorships and joint ventures, and professional corporations for qualifying professionals. We restructure existing and growing businesses through the expansion of shareholders and investors, or the reduction of existing directors and/or officers.

    We prepare transactional documents for simple or complex corporate reorganizations, including preparing articles of amendment, amalgamation, revival, continuance or dissolution for your corporation.

    Buy and Sell a Business

    Our business and corporate-commercial lawyers assist in the purchase or sale of a business from the letter of intent, to the agreement of purchase and sale, to the final closing documents.

    Business Advisory

    Our dedicated corporate lawyers advise your business in legal matters of employment and independent contractor agreements, tax deductions, tax forms, business set-up, international trade, foreign incorporation and corporate structuring.

    Agreements and Contracts

    We prepare a variety of agreements ensuring that the rights and obligations of all parties are reflected and protected. These include employment contracts, confidentiality and non-disclosure agreements, non-competition agreements, distribution agreements, and service agreements.

    We prepare commercial leases between landlords and tenants, as well as purchase and sale agreements across a variety of industries, including those in the food, health, medical, dental, trade, wholesale distribution, fashion, mining, and technology sectors.

    Shareholder Agreements and Dispute Resolution

    Our business law team prepares shareholder agreements that govern the relationship between the various parties involved in your business. Where disputes arise, our lawyers will guide you through shareholder disputes that often take place between partners or between partners and shareholders.

    TAX SERVICES

    corporate-commercial lawyer toronto

    Kalfa Law assists corporate clients in the preparation of comprehensive and dynamic tax plans to achieve optimal tax-saving results.

    We assist our clients in reducing their tax debt by preparing Taxpayer Relief Applications to reduce or eliminate the ballooning penalties and interest levied by the CRA.

    We also service businesses in their tax disputes with the Canada Revenue Agency. We prepare comprehensive submissions and appeals that defend and further our clients’ interests when they have received notice that their tax filings are under audit or when their deductions or benefits are being denied. Where necessary, we bring matters to the Tax Court of Canada to appeal the decision of the CRA.

    We prepare Voluntary Disclosure applications for clients who have failed to report their full income or offshore holdings in previous taxation years, allowing them to correct incorrect filings without the CRA’s imposition of harsh penalties and interest.

    For those clients who experience the CRA’s more severe collection and enforcement actions, such as garnishments, liens and seizures, we negotiate with the CRA to lift the enforcement actions and establish a voluntary payment plan.

    Got a tax problem? We’re here to help. ™

    TAX PLANNING

    We provide tax-planning services to businesses requiring personal, corporate, international, and estate planning solutions, helping to avoid potential problems, reduce tax burdens and maximize wealth.

    Our tax division collaborates with our corporate-commercial/business law division in the preparation of corporate tax structures, providing optimally integrative solutions.

    Our cost-effective tax plans and strategies meet the dynamic and evolving nature of your business as it grows and changes over time, providing solutions related to tax burdens, international trade, foreign incorporation and corporate structuring.

    Need a tax plan? We’re here to help.™

    F.A.Q’s:

    What are the benefits of setting up a business as a sole proprietorship?
    The sole proprietorship business structure are for businesses that have only one business owner. This type of business structure is simple and inexpensive to set up. If the business is operated under the owner’s personal name, then no registration is needed. Registration is required only if operating under a trade name. The regulatory burden of the sole proprietorship is light with minimal paperwork and legal costs. Moreover, there are no employees, partners, or investors to contend with, which may be advantageous if your business earns less than $100,000 a year. The simplicity of the sole proprietorship makes a great deal of sense, particularly if don’t envision selling your business or passing on your business to heirs. A sole proprietorship is a pass-through tax entity. A pass-through entity is a special business structure that is used to reduce the effects of double taxation. That means that there is no tax paid at the sole proprietorship level. Instead, all profits flow to the sole proprietor directly. In summary, the advantages of a sole proprietorship include the following:
    • Easy and inexpensive to register.
    • Regulatory burden is generally light.
    • You have direct control of decision making.
    • Minimal working capital required for start-up.
    • Some tax advantages if your business is not doing well.
    • All profits go to you directly.
    What are the benefits of setting up a business as a partnership?
    The partnership business structure is for businesses that have two or more partners. Setting up a business as a partnership is more advanced and expensive than a sole proprietorship. The partners must file both a T1 Income Tax and Benefit Return to file personal income as well as a T5013, a Partnership Information Return. Partners in a general partnership agreement assume personal liability for debit and do not have access to certain tax planning strategies, such as income splitting. However, if the partnership is a professional one (e.g., dentists, doctors, accountants), the partners can set up a Limited Liability Partnership (LLP), which will limit the personal liability of the partners themselves.
    What are the benefits of setting up a business as a corporation?
    Setting up a corporation is complex and expensive, however there are a number of benefits: The benefits of incorporation are limited liability, separate legal entity, perpetual existence, and free transferability. The most important advantage of setting up a business as a corporation is the income tax savings. Although there is double taxation, once on the corporate level and again on the shareholder level, once dividends are transferred to shareholders, less tax is still paid overall on income that is earned through a corporation, where the business is a Canadian Controlled Private Corporation (CCPC). Currently, a CCPC in Ontario is taxed at 12.2% on the first $500,000 of ABI in each year, which is 25.5% less than the combined average marginal personal tax rate of approximately 38%. A corporation can also utilize tax savings strategies such as income splitting and the Lifetime Capital Gains Exemption. It should be noted, however, that a professional corporation, which is a corporation owned by members of certain professions, such as physicians, lawyers, accountants, and doctors, cannot income split with family members. Finally, a corporation protects the corporation’s owners from personal liability, thereby safeguarding the owner’s personal assets from corporate creditors and/or lawsuits. Sole proprietors are liable to the full extent of their personal assets for the liabilities of their businesses, whereas a shareholder’s liability to creditors of the corporation is limited to the amount of the shareholder’s investment. Directors are not liable at all (except where the director engages in fraud).
    What is a corporation?
    A corporation is a legal entity that is separate and distinct from its owners. The technical definition of a corporation is "an artificial creation of the law existing as a voluntary chartered association of individuals that has most of the rights and duties of natural persons but with perpetual existence and limited liability." In other words, a corporation exists as a separate legal structure, almost as if it were a person under the law. Corporations enjoy most of the rights and responsibilities that individuals possess: they can enter contracts, loan and borrow money, sue and be sued, hire employees, own assets, and pay taxes
    What does limited liability mean?
    In the event a corporation becomes insolvent, the owner and shareholders are not liable for the debts or other obligations incurred by the corporation. Yes, the shareholders will lose their investment, but they will not be responsible for its debt.
    What does separate legal entity mean?
    Separate legal entity refers to a corporation’s operating as distinct from its shareholders, directors, and officers.  A corporation (like a person) can own property, enter into a contract, sue and be sued, and be convicted of a criminal offense (corporations pay fines in lieu of imprisonment.) A corporation exists as its own entity, regardless of what happens to the individuals involved in the business.
    What does perpetual existence mean?
    Perpetual existence refers to a corporation’s continued existence until it is liquidated, dissolved, or acquired by another entity. When a business is incorporated, the owners, officers, and shareholders (the organizers) can choose to give it an end date when the mission of the corporation has been fulfilled. More commonly, a corporation acts in perpetual existence; that is it will continue to exist, until the organizers decide to end it. Even if the executive team and employees were to quit, the business corporation as an entity would continue to exist, and new employees could take their place.
    What does free transferability mean?
    Free transferability refers to the shareholders’ ability to sell shares without the consent of the directors, officers, or other shareholders, unless otherwise restricted in the corporate constitution. That being said, shareholders in a new venture often will want to prevent unrestricted transfer of shares and thus may provide transfer restrictions or buy-sell and redemption agreements in the articles of incorporation, further limiting transferability. There are separate rules and restrictions governing the transfer of shares in a private versus a public corporation.
    What kind of bank accounts should I open for my new start-up business?
    All businesses, whether you are operating through a corporation or sole proprietorship, require a separate bank account. Bring either your Articles of Incorporation or your Master Business License to your bank or financial institution when you are ready to open a business account. You may also want to open an additional tax account to hold the HST you collect from your customers.
    What kind of tax accounts will I need when starting up a new business?
    In order to be in good standing with your taxes, you will need to take care of some administrative details when launching a new start up business. Firstly, you will need to register for a business number (BN), HST account if you anticipate making more than $30,000 a year, a payroll account (PR) and a Workplace Safety and Insurance Board (WSIB) account if you have employees, and an Employer Health Tax (EHT) account if your payroll exceeds $450,000.
    Do I need to have a legal agreement between the owners or partners of my business?
    That depends on the type of business structure that you have. If your business is a corporation, you should organize your corporation set out in resolutions that clearly indicate who the director, officers, and shareholders are and the rights and obligations of each party. If your business is a partnership, then a partnership agreement should be drafted outlining the rights and obligations of each partner and how the profits of the business will be shared. Finally, if there are more than one shareholder, there should be a shareholders agreement to set out the rights, obligations, and duties of each shareholder, as well as the rules for existing shareholders, buying out of shares, and policies if a shareholder becomes disabled, dies or divorces.
    What kind of contracts will I need with third parties for my business start-up?
    When starting a business, you will likely require business contracts with suppliers, distributors, and service providers. Whether you are in the business of selling goods or services, you will likely need distributor agreements, supply agreements, service agreements, sales agreements, licensing agreements and lease agreements.
    Can I incorporate with an online service or do I need a lawyer to incorporate?
    There are many online services that claim to incorporate your business for as little as $100. You may incorporate using an online service, however they will likely not complete the incorporation process. They will only complete step 1 of a two-step process. That means, you will receive articles of incorporation, but that does not mean that the incorporation process is complete or valid. It is only complete and valid when you complete step two, which occurs when you prepare organization resolutions and issue shares to shareholders. You can complete step one by yourself. The provincial and federal government provides this service for free and do not need to spend $100-$200 for a service that provides no extra value at all. While it is possible to incorporate yourself, it will require a great deal of research yourself. You will have to review the Ontario Business Corporations Act and find out what the required resolutions are. You will have to prepare the resolutions, issue the shares, and obtain a formal minute book. For most people, they are advised to use a lawyer to incorporate, which will ensure that all the legal requirements for incorporation have been fulfilled. Using a lawyer will also help you get set up with all the other aspects of starting a business, from preparing employment, service, and distribution contracts, branding and trademarks, and obtaining the corrects licenses and permits.
    What happens if I do not complete step 2 of the incorporation process, which involves preparing organizational resolutions and issuing shared to shareholders?
    If you do not prepare organizational resolutions and issue shares to shareholders, then your corporation is not incorporated legally. The Ministry can dissolve your corporation and you will have to start the incorporation process at that time. Additionally, you will lose all the benefits of incorporation. You will not have the benefit of limited liability or reap the tax advantages of incorporation. Further, you will not be able to sell your corporation as it was never properly constituted and you will be deficient in your annual resolutions, which under the law require directors and officers of a corporation to approve the financial statements each year.
    Do all businesses have to register their business name?
    Almost all businesses in Canada must register their business name in their respective provinces or territories except for sole proprietorships that use only the owner's legal name with no additions. All other forms of business ownership, including partnerships, must register their business names.
    What are the steps that I need to take to register my business name?
    The basic procedure to register a business name for a sole proprietorship or partnership is to conduct a business name search, fill out the appropriate business registration form, and pay your fee. The procedure to register a business name for a corporation is more involved. Besides conducting a name search and getting a NUANS report, if you wish to set up a named corporation, you will also have to prepare Articles of Incorporation, a cover letter and an incorporation application to go along with your fee.
    How often must I renew my business’s name?
    You must renew your business’s name it every five years; however, you can renew a registration within 60 days after it expires.
    What are the steps that I need to take to register my business’s name?
    In order to complete registration of your business name, you will need to provide the name and address of the business where legal papers can be served, as well as the name and home addresses of each partner where a partnership has 10 or fewer partner. You will also need to provide a description of the business activity being performed; and a valid email address if you are registering via email.
    If I register my business name, does that mean that I have exclusivity to the name?
    No it does not. Registering your business name does not mean that you have exclusivity. That will require you to trademark your name. While the Business Names Act does not prohibit you from registering a name that is the same or similar to others, you may find yourself in a lawsuit. That is why it is best to conduct a names search first to make sure that no one else is using the name that you want.
    Where do I go to register my business name?
    You can register your business name online, mail, or register in person. To register online, you can register with the following services:
    1. Service Canada’s Business Name Registration Service
    2. Service providers Cyberbahn, ESC Corporate Services Ltd, and OnCorp Direct Inc. or
    3. CRA’s Business Registration Online Service
    If registering in person, go to the following address: Ministry of Government and Consumer Services Central Production and Verification Services Branch 375 University Avenue, 2nd floor Toronto, ON M5G 2M2 If registering by mail, write a cheque or money order for $80, made out to the Minister of Finance, and mail to the following address: Ministry of Government and Consumer Services Central Production and Verification Services Branch 393 University Avenue, Suite 200 Toronto, ON M5G 2M2
    What is required to make a contract legal?
    In order for a business contract to be considered valid, there must be:
    • Offer and acceptance
    • Consideration
    • Capacity
    • Consent
    • Lawful Purpose
    In every valid contract, offer, acceptance and consideration are vital aspects. First an offer is made that contains all the important and relevant terms of the contract in a clear and precise manner.  Then the offer is accepted, after which something of value, either an object or service is exchanged between the parties as consideration. In every valid business contract, both parties must have the ability or capacity to understand the terms and nature of the contract. Therefore, anyone with a developmental disability, impaired judgement or who is not the age of majority in Canada (18 or 19 years) does not have the capacity to enter into a valid and enforceable contract. Each party involved in the business contract must freely consent or agree to the terms of the contract. That means that a contract is not valid if there has been misrepresentation, fraud, or undue influence. Finally. Canadian law requires that business contracts are lawful in their intent. In other words, no contract can be negotiated for a service or exchange that violates the law.


    -Shira Kalfa, BA, JD, Partner and Founder

    Shira Kalfa is the founding partner of Kalfa Law. Shira’s practice is focused in corporate-commercial and tax law including corporate reorganizations, corporate restructuring, mergers and acquisitions, commercial financing, secured lending and transactional law. Shira graduated from York University achieving the highest academic accolade of Summa Cum Laude in 2012. She graduated from Western Law in 2015, with a specialization in business law. Shira is licensed to practice by the Law Society of Ontario. She is also a member of the Ontario Bar Association, the Canadian Tax FoundationWomen’s Law Association of Ontario, and the Toronto Jewish Law Society. 

    © Kalfa Law 2020

    The above provides information of a general nature only. This does not constitute legal advice. All transactions or circumstances vary, and specified legal advice is required to meet your particular needs. If you have a legal question you should consult with a lawyer.
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