You want to make a difference and maybe earn a living doing it. But should you register a business, a non-profit or a charity? It is one of the most common questions we hear from women founders, and choosing the wrong structure can cost time and money to fix later.

This guide explains your options in plain language, with five questions to help you decide and registration basics for Alberta.

Start with one question

Who is this for, and where will the money come from? If you want to earn income from profits, a business usually fits. If your main goal is community benefit and you expect grants or donations, a non-profit may be a better fit.

Your options at a glance

Sole proprietorship

You and the business are the same. It is simple and low-cost to start, but you are personally responsible for any debts.

Partnership

Two or more people own the business together. Always put a written partnership agreement in place.

Corporation

A separate legal entity, incorporated provincially or federally. It limits personal liability but has more cost and paperwork.

Non-profit organization

Exists for a social or community purpose. It can earn revenue, but surplus goes back into the mission. It cannot issue charitable tax receipts.

Registered charity

A non-profit with charitable purposes, registered with the Canada Revenue Agency. It can issue tax receipts, but follows stricter rules on activities, spending and reporting.

Five questions to help you choose

1. Do you want to earn personal income from profits? If yes, a business usually fits.
2. Is your main goal community benefit? If yes, consider a non-profit.
3. Will most of your money come from grants or donations? Many grants are only open to non-profits or charities, and donors who want tax receipts need a registered charity.
4. Are you ready for a board and governance? Non-profits and charities are governed by a board with bylaws, meetings and records.
5. How much risk are you taking on? If you will sign leases, hire staff or borrow money, consider a structure that limits personal liability.

A real example

Families Arising is an incorporated non-profit, not a registered charity. This lets us apply for many grants and deliver community programs while keeping administration lighter than a charity. The trade-off is that we cannot issue charitable tax receipts. There is no single right answer. The right structure depends on your goals.

What about a social enterprise?

A social enterprise uses business methods to create social impact. It can be a business with a strong mission, or a non-profit that earns revenue through paid programs. Many founders start with one structure and add the other later.

Registration basics in Alberta

• Businesses: sole proprietorships and partnerships usually register a trade name, and corporations incorporate, through an Alberta registry agent or online.
• Business Number: get one from the Canada Revenue Agency for your tax accounts.
• GST/HST: registration is required once taxable sales pass $30,000 over four consecutive calendar quarters.
• Non-profits: incorporate as a society under the Alberta Societies Act, or federally under the Canada Not-for-profit Corporations Act.
• Charities: apply to the CRA for charitable registration after you incorporate.

Frequently asked questions

What is the difference between a non-profit and a business?

A business can distribute profits to its owners. A non-profit exists for a social or community purpose, and any surplus must go back into its mission rather than to owners or members.

Is a non-profit the same as a charity in Canada?

No. A registered charity is a non-profit that has charitable purposes and is registered with the Canada Revenue Agency. Charities can issue tax receipts but follow stricter rules. Many non-profits are not charities.

Can a non-profit make money?

Yes. Non-profits can earn revenue through fees, programs and products. The difference is that surplus is reinvested in the mission, not paid out as profit.

How do I register a non-profit in Alberta?

You can incorporate as a society under the Alberta Societies Act, or federally under the Canada Not-for-profit Corporations Act. Each has its own requirements, so check the official guidance before you apply.

Related reading: How to start a business: a 30-day plan · How to get funding ready

This article is general information, not legal, tax or financial advice. Rules change, so please confirm with the official source or a qualified professional.

Families Arising Resource Centre Edmonton is a registered non-profit that supports Black, immigrant, newcomer and multicultural families. Through Mom Youniversity, we have coached women to launch, build and grow businesses and organizations since 2020. Explore Mom Youniversity or browse our free business resources.