Share capital

• Defined in the articles of incorporation (the official document that creates the company), at the federal level or in Quebec
• Ordinary shares: they grant voting rights, a share of profits (dividends), and a contribution to the company's value.
• Preferred shares: tailored rights, practical solutions to prepare for the transfer of the business
• A flexible share capital structure makes it easier to organize your taxes later on.

Imagine a pizza: the share capital determines in advance how many slices it can be cut into and who gets to eat them. Many entrepreneurs choose a generic share capital structure when setting up their business without giving it much thought, then pay dearly years later to restructure it. A well-thought-out structure from the outset opens doors: distributing different profit shares according to ownership categories, bringing in a spouse or investor, and preparing for succession. Be aware: the tax rules governing profits paid to family members are strict. Bankeo will introduce you to a certified accountant free of charge to align your share capital with your objectives, and we'll be there to support you every step of the way.

What exactly is social capital?

These are all the shares that your company has the right to create and issue to its owners in exchange for their money. It's essentially the company's capital pooling plan: it defines who owns what and what rights each share grants (voting, receiving a share of the profits, benefiting from an increase in value).

What is the difference between ordinary and preferred shares?

Ordinary shares generally grant the right to vote, receive a share of the profits (a dividend), and benefit from an increase in the company's value. Preferred shares offer special rights, often a priority share of profits or a predetermined redemption value, useful for preparing for the transfer of ownership or the arrival of an investor.

Can the share capital be changed after the company has been created?

Yes, by amending the articles of association or reorganizing the company, but these operations require professionals and may incur taxes. It is almost always cheaper to plan for flexible share capital from the outset than to redo everything later, when the shares have increased in value. Bankeo provides you with a free, audited accountant to assist with company formation, at no cost to you, and we remain by your side throughout the process.