- A professional corporation is a corporation formed under the Business Corporations Act (Ontario) that is permitted to carry on the practice of a specific regulated profession.
- Ordinary Ontario corporations have no ownership restrictions and no professional oversight.
- Form an Ontario corporation under the Business Corporations Act that meets your college's naming and ownership requirements.
Many regulated professionals in Ontario — doctors, lawyers, dentists, accountants, and others — eventually consider incorporating their practice for tax and succession-planning reasons. But a professional corporation is not like an ordinary business corporation you can simply register and start using. Before it can provide services, it needs a certificate of authorization from the professional's own regulatory college.
Skipping this step, or assuming incorporation alone is enough, is one of the more common and avoidable mistakes professionals make when setting up their practice.
What Is a Certificate of Authorization?
A professional corporation is a corporation formed under the Business Corporations Act (Ontario) that is permitted to carry on the practice of a specific regulated profession. Incorporating it is only half the job. The individual professional's regulatory college — the same body that licenses the person to practise (for example, the Law Society of Ontario for lawyers and paralegals, or the relevant health college for a physician or dentist) — must separately issue a certificate authorizing that corporation to practise the profession.
Until the certificate is issued, the corporation legally exists, but it is not authorized to provide the professional service. The professional generally cannot bill for that work through the corporation until the certificate is in hand.
Why Incorporating Alone Isn't Enough
Ordinary Ontario corporations have no ownership restrictions and no professional oversight. Professional corporations are different: each regulatory college sets its own conditions before it will authorize one, and continues to oversee it afterward. Conditions commonly include:
- Ownership restrictions. Voting shares generally must be held by licensed members of the profession, sometimes with narrow exceptions allowing certain family members to hold non-voting shares.
- Naming requirements. The corporation's name typically must include the name of one or more shareholders and words identifying it as a professional corporation.
- Insurance requirements. The college may require the corporation (or its professional shareholders) to carry professional liability insurance.
- No liability shield for malpractice. Incorporating does not protect the individual professional from personal liability for their own professional negligence — the certificate is about permission to practise through a corporation, not about limiting that liability.
Getting a Certificate of Authorization: The General Process
- Incorporate first. Form an Ontario corporation under the Business Corporations Act that meets your college's naming and ownership requirements.
- Apply to your regulatory college. Each college has its own application, generally requiring proof of the corporation's structure and the professional's good standing.
- Meet the college's conditions. This usually covers share ownership, naming, and insurance — confirm the current requirements directly with your college, since they vary by profession.
- Wait for the certificate before practising through the corporation. Providing services or billing through the corporation before authorization is issued can create problems for both the corporation and the individual professional.
- Renew and maintain it. Colleges generally require ongoing compliance and periodic renewal — the details differ by profession, so check your college's current rules rather than assuming a fixed schedule.
What Happens if You Practise Without One?
Operating a professional corporation without the required certificate can expose the individual professional to a professional-conduct problem with their college, separate from any question about the corporation's own legal status. It can also create uncertainty about insurance coverage and billing arrangements. If you're unsure whether your certificate is current or whether a recent change (a new shareholder, a name change) requires an update, that is worth resolving before it becomes an issue.
Frequently asked questions
Does a certificate of authorization protect me from malpractice claims?
No. It authorizes the corporation to practise the profession — it does not shield the individual professional from personal liability for their own professional negligence. That liability generally follows the person, not the corporate structure.
Can non-professionals own shares in a professional corporation?
Some colleges allow limited non-voting ownership by certain family members, but rules vary significantly by profession and can change. Confirm directly with your specific regulatory college before assuming any structure is permitted.
Do I need a new certificate if I change my corporation's name or shareholders?
Generally, yes — your college's records need to reflect your corporation's current name and ownership structure. Confirm the required update process with your college rather than assuming the original certificate still applies.
Is a professional corporation the same as an ordinary numbered company?
No. Both are incorporated under the Business Corporations Act (Ontario), but a professional corporation must also satisfy its college's ownership, naming, and insurance conditions and hold a valid certificate of authorization — requirements an ordinary business corporation doesn't have.
This is a corporate question
Start a file online — flat, published fees, reviewed by a licensed Ontario lawyer before a dollar is owed.