Doing business in Canada from France: a guide for companies and professionals

Expanding into Canada from France means entering an English- and French-speaking market, very close to the United States, with its own tax and legal rules. This guide covers the basics: how the market is organised, how to use the trade agreement between the European Union and Canada, which structure to choose, which taxes to charge and how to send your staff. Each part links to a detailed topic page and to the official sources.

Understanding the Canadian market

Canada has ten provinces and three territories. Its population, just over 41 million, is concentrated along the US border. Ontario and Quebec alone account for about six in ten Canadians, ahead of British Columbia and Alberta.

The division of powers is the first thing to understand, because it determines which authority you deal with:

In practice, you establish in one province and expand from there. Choose the starting province based on your sector, your working language and your customers. Quebec offers a French-speaking market and active Franco-Quebec networks; Toronto concentrates finance and head offices; Vancouver and Calgary look towards Asia-Pacific, technology and energy. Our Entering the Canadian market page details these choices, and the province table summarises languages and taxes.

Exporting under CETA

The Comprehensive Economic and Trade Agreement between the European Union and Canada, provisionally applied since September 2017, removed customs duties on the vast majority of tariff lines. It only applies to goods that meet its rules of origin: a product merely shipped through France, or made mostly from non-European components, may not qualify.

• The European exporter certifies origin with a statement on the invoice; above a certain value, they must be registered in the EU’s Registered Exporter system (REX).
• The Canadian importer declares the goods to the CBSA and pays GST (and, where applicable, provincial tax), even when customs duties are zero.
• Canadian standards (electrical, safety, cosmetics, food) still apply: CETA does not remove product compliance.

For customs procedures in detail, see Import-export and customs.

Choosing how to enter

The right entry model depends on your expected volume of business, the need for a local presence and your appetite for administration.

Our market-entry checklist tailors the list of steps to each of these models.

Setting up a company in Canada

A corporation can be incorporated federally (Corporations Canada) or in a province. Federal incorporation protects the name across Canada, but the corporation must then register in every province where it operates. A provincial corporation can also register in other provinces (extra-provincial registration).

Once the company exists, plan for:

• a CRA business number (BN), the basis for tax, import and payroll accounts;
• in Quebec, registration with the Registraire des entreprises and a NEQ;
• a Canadian business bank account, which often takes several weeks to open;
• any municipal or sector permits (retail, food, regulated professions).

Incorporation and structure covers these steps in detail.

Tax: sales taxes and income tax

Sales taxes

Canada has no single VAT. The 5% federal GST applies everywhere; five provinces have merged it with their own tax into an HST (13% to 15%), while Quebec, British Columbia, Manitoba and Saskatchewan levy a separate provincial tax. Alberta and the territories only have the GST. The rate to charge generally depends on the place of supply, so on the customer’s province.

A business must register for GST/HST when it carries on business in Canada and exceeds the small supplier threshold ($30,000 of taxable sales over four consecutive quarters). Simplified regimes also cover non-resident businesses selling digital products or services to Canadian consumers, both federally and in Quebec. The VAT vs GST comparison sums it up.

Corporate income tax

A Canadian corporation pays federal tax and the tax of its province. The general combined rate is roughly between 23% and 31% depending on the province. The small business rate is reserved for Canadian-controlled private corporations: a subsidiary owned by a French company normally does not qualify, a point often missed in business plans.

The France–Canada tax treaty governs the taxation of profits, dividends paid to the parent company and posted employees. Have your structure validated by a tax adviser active in both countries before incorporating.

Further reading: Business taxes and E-commerce and banking.

Language, labelling and compliance

• Bilingual labelling: most prepackaged consumer products sold in Canada must carry mandatory information in French and English.
• Quebec: the Charter of the French Language requires French in commerce and business (signage, websites aimed at Quebec customers, contracts of adhesion, documents given to employees).
• Personal data: federal and provincial privacy laws, with stronger requirements in Quebec; the anti-spam law (CASL) for commercial emails.
• Prices: quote your prices before tax, like your Canadian competitors, making clear that applicable taxes are added.

Hiring and posting employees

Sending a French employee to Canada almost always requires a work permit. The routes most used by French companies are intra-company transfers, the International Experience Canada Young Professionals stream (ages 18 to 35), Francophone Mobility for a job outside Quebec, and a permit supported by a Labour Market Impact Assessment (LMIA). Our visa finder helps identify the right route for each profile.

France has a social security agreement with Canada, and a separate one with Quebec. Under conditions and for a limited period, a posted employee can stay in the French system and be exempt from the equivalent Canadian contributions. Beyond that, Canadian payroll applies: income tax withholding, pension plan (CPP, or QPP in Quebec), Employment Insurance, parental insurance in Quebec and, in several provinces, an employer health levy.

Leave, notice and overtime fall under each province’s law. The salary calculator shows what a Canadian gross salary means in take-home pay for your employee. Details in Hiring and posting staff.

A realistic timeline

These durations are observed orders of magnitude, not official deadlines: permit processing times are published and updated by IRCC. Start the longest steps (work permits, banking) in parallel with structuring.

The market-entry checklist breaks these phases down task by task, filtered by your entry model.