Skip Header Navigation

Call 1-800-769-2520

Skip Breadcrumb Links  
Small Business > Resource Center > Business Tips > Tips 7-9

Tips 7-9

Tip #7: There's financing. And there's financing

When starting a business, it's essential you have sufficient funds. The type of financing you secure will depend on your start up, cash flow and operational requirements. Your RBC small business advisor can help you understand the different types of financing available to meet your specific needs. Meanwhile, here's a quick primer to get you started.

What do you need money for? Possible solution How it works for you

To cover short-term expenses like supplies, payroll and rent until my sales generate real cash.

To get through the startup phase of my business.

My business is seasonal and I need money to get through seasonal slow periods.

Operating line of credit
  • Approval in advance to borrow up to set amount.
  • Pay down as cash comes in.
  • Pay monthly interest on amounts borrowed.

To cover and track short-term expenses like office supplies, business travel and utility payments.

Possible solution
Business credit cards

Business credit cards
  • Easy access to cash.
  • Track expenses for planning and record keeping.
  • Make purchases interest free until payment is due.
  • Earn reward points.

To buy hard assets necessary to operate my business: buildings, vehicles and equipment.

Term loan
  • Pay off over longer time - avoid tying up credit line/cash flow.
  • Regular payments make it easy to forecast cash flow.
  • Match term of loan to life of asset - pays for itself over time.

New equipment, vehicles technology or furniture to grow my business.

  • Good choice when you don't have the cash flow or do not wish to buy outright.
  • Up to 100% financing available.
  • Often requires little or no upfront cash.
  • Structured to match the useful life of the equipment - pay as you use the equipment.
  • Monthly payment may be income-tax deductible.
  • End of term options provide you with the flexibility to manage equipment needs effectively and efficiently.

To protect my business, my partners and my family in case something happens to me.

Business Loan Insurance Plan
  • Pays off or reduces the business loan in the event an owner or key employee passes away or is diagnosed with a critical illness (heart attack, cancer or stroke).
  • Helps pay or reduce loan payments in the event an owner becomes disabled and is unable to work.
  • Preserve personal insurance for what it's intended – protecting your family.
  • Keep your business investments and other assets intact.

To Top To Top


Tip #8: Know the ABCs of GST, RST, PST and HST

Running a business invariably involves collecting and remitting various types of taxes determined by the nature and size of your business, as well as where you operate. Understanding what, when and how to collect, as well as when and where to remit isn't as difficult as it may seem. We can help.

Making sense of taxes

You are obligated to register for a GST number once your business revenues exceed $30,000. If your business sells goods subject to Retail Sales Tax (RST), you're responsible for collecting and remitting to the Ministry of Finance in a timely fashion. -taxable goods or services, you must charge RST, collect it and remit it to the immediately

Once you register for the GST, you must charge GST to all your customers and remit it to Canada Revenue Agency (CRA). You can claim a refund on the GST you pay to acquire any goods and services you need for your business. If your business sells goods or services subject to Retail Sales Tax (RST), also referred to as Provincial Sales Tax (PST), you must charge RST/PST and remit it to the Ministry of Finance. You also have to register with the Ministry of Finance for a registration certificate and provincial tax number. You can do this at the Ministry of Revenue or at Ontario Business Connects.


If your annual taxable sales are $500,000 or less, you must remit GST quarterly (every 3 months) and report annually. If your sales are more than $500,000 but less than $6 million, you must report monthly and remit quarterly. And if your sales exceed $6 million, you must report and remit monthly.

Even if you don't expect to have revenues in excess of $30,000 in your first year of business, you may want to apply for a GST number and charge the tax anyway. You'll be refunded the GST you pay on the goods and services your business buys - and not collecting it may be seen by your customers as a sign that you're too small to serve their needs.

Things to note:

When determining whether or not you need to register for the GST/HST, look at your income in consecutive quarters. If it exceeds $30,000 in any quarter, you must register.

Sole proprietors operating more than one business must combine the income from all businesses when determining whether or not to register for the GST/HST. For example, if one business had total revenues (before expenses) of $20,000 and a second business had total revenues (before expenses) of $12,000 in four consecutive quarters, you would need to register for and charge the GST.

If you are a public service body, such as a charity, you do not have to register for the GST until your total revenues exceed $50,000.


While different rules apply for each Province, Retail Sales Tax (RST), also referred to as Provincial Sales Tax (PST) applies to most goods sold, as well as services to install, repair and maintain taxable goods and equipment. RST/PST also applies to all prepared food products totaling $4.00 or more.

Taxes by Province

Province GST PST HST
British Columbia1 Check Mark Check Mark  
Alberta Check Mark    
Saskatchewan Check Mark Check Mark  
Manitoba Check Mark Check Mark  
Ontario Check Mark   Check Mark
Quebec2 Check Mark Check Mark  
Newfoundland     Check Mark
New Brunswick     Check Mark
Nova Scotia     Check Mark
PEI2 Check Mark Check Mark  
Yukon Check Mark    
NWT Check Mark    
Nunavut Check Mark    

1) In British Columbia, businesses can choose to collect the provincial sales tax and GST separately, or they can elect to charge the harmonized sales tax (HST). The effective tax rate is the same in either case.
2) In Prince Edward Island and Quebec, the PST is charged on the final sale price plus the GST. In other provinces that levy a provincial sales tax, both the GST and PST are charged on the final sale price.

Special rates apply to accommodation for less than a month (5%), admission prices over $4.00 (10%) and alcoholic beverages (10%/12%, depending on the method of distribution).

If your business sells RST/PST-taxable goods or services, you must register with the Ministry of Finance to obtain a registration certificate and provincial tax number to collect and remit RST/PST . For more information, contact Ontario Business Connects. For all other Provinces, call the Ministry of Revenue tax office nearest you. You can get a list from the Ministry Information Centre or by calling 1-800-263-7965.

Additionally, you must register with the Consumer Taxation Branch, Ministry of Provincial Revenue, and collect social service tax (retail sales tax) on your taxable sales and leases if you engage in any of the following activities:

  • Selling goods at retail.
  • Leasing goods as a lessor.
  • Providing legal services.
  • Providing taxable services (e.g. repairs to goods).
  • Providing telecommunications services.

To Top To Top


Tip #9: Do you qualify for a grant?

Invest a little time to learn more about grant funding

Let's face it, any cash-strapped start-up business would jump at the prospect of grant funding. But, while grant programs do exist, not every business is eligible for every grant. And the eligibility details for the available grants can change without notice. So the first step in tracking down free funding is to find out which grants are available right now.

The quest begins

Begin your search at (opens new window), the Government of Canada's Services for Entrepreneurs website. Enter "grant" into their Search box and you''ll see a set of links that can connect you to web pages outlining specific programs and their qualifications. You'll find out some of the specifics about each potential grant, including:

  • Who is eligible
  • What amounts are available
  • Which geographical regions qualify
  • Application procedures and deadlines
  • Who to contact for more information

While this can mean investing some of your valuable time, it's a cost-efficient way to determine which grants you may be eligible for - and whether it makes sense to pursue them.

The personal touch

Not everyone who is eligible for a grant is automatically approved for it. That's why it's important to find out which criteria will be used to assess your application. And the best way to do that is to speak with your local government representative. A phone call is good; meeting in person is even better. Not only will it help you better tailor your grant application, but there's a chance that when you submit the application the person your applying to will give it the attention you want because they'll be expecting it.

Assessing your chances

Even if your grant application meets all of the published eligibility requirements, you're only part of the way to the finish line. You also have to consider which less-tangible criteria your proposal may end up being judged by, including:

  • What public relations benefits or concerns could your proposal trigger for the government and/or the department providing the grant?
  • Does your proposal make economic sense?
  • Will the grant sponsor be convinced that you (and your partners) have the experience and expertise to make a success of the business?
  • What is your projected return on investment (ROI)?

When it comes to handing out money, government agencies are every bit as pragmatic as a banker or investor; by approaching government agencies with that mindset, you can improve your chances of qualifying for the grant.

Helping those who help themselves

More and more, governments prefer to invest in small businesses rather than simply bestowing large sum of money on them. It may involve matching your own investment in the business, providing operating loans at preferred interest rates, or some other form of assistance. In other words, the more successful you are at raising capital for yourself, the better your chances of receiving government funds, whether it's in the form of a grant or a loan.

To Top To Top

Previous Tips    Next Tips


Contact Us

An RBC small business advisor can provide the advice, tools and other resources to help you create your ideal business.


The content provided here is for informational purposes only. You should consult your own professional advisors when implementing any strategy to ensure your individual circumstances are properly considered and that your actions are based on the latest available information.


Talk to a Specialist

Our dedicated specialists are available to help find a flexible borrowing solution for your business.