If you run a Canadian business and it is incorporated, federally or provincially, you need to legally keep certain records.
These records keep track of the corporation’s activities and can be subject to government review to ensure your business is in compliance. The book that all of this information is kept in is called a “Minute Book.”
Why a Minute Book?
A Minute Book is where the minutes of meetings are kept. A Minute Book can be requested by government agencies, lawyers, accountants, and other officials.
In addition to the legal requirement of maintaining a Minute Book, it’s important to keep the corporation’s business dealings up-to-date on a practical level too.
If a company’s Minute Book is not updated, it can lead to serious problems for both the corporation and its shareholders.
Failing to maintain a Minute Book can result in fines of up to $25,000.
What Is a Minute Book?
A Minute Book is a history of all the important businesses decisions the corporation makes.
When a business becomes incorporated, the Minute Book will contain:
- Articles of incorporation
- Initial resolutions
- Consent to act as directors
- Consent of officers
- Subscription for shares.
After the initial setup, future Minute Books might include:
- Change of corporate directors
- Details of the corporation’s quarterly and annual financial statements
- Filings periods
- Names and addresses of all shareholders
- Changes in the share structure
- Annual meetings
Again, failing to keep the Minute Book current could result in serious fines and prevent a corporation from maintaining proceedings in court.
When a Minute Book Might Be Requested
Your corporation’s Minute Book can be requested by government agencies, lawyers, and accountants.
Reasons why they might request to look at your Minute Book include:
- Tax audit by the Canada Revenue Agency
- Accountant wants to provide tax advice or corporate financial planning
- Transferring ownership
- Corporation looking to obtain financing
- Tax audit by provincial safety and insurance board (WSIB/WCB)
- Shareholder wants to sell shares
- Selling company or forming new corporation
- Amending Articles of Incorporation
Not having a properly maintained Minute Book could result in your corporation missing out on critical financing or missing out on a major transaction.
It could also result in the corporation paying more tax than necessary or missing out on tax breaks.
FBC, Helping Canadians Reduce Their Tax Burden
Corporate business owners in Canada are usually more focused on operating their business than maintaining their Minute Book.
Since 1952, FBC has worked exclusively with corporations, small business owners, farm operators, and independent contractors.
For more than 65 years, we have helped tens of thousands of clients from coast-to-coast prepare and file their taxes.
If you need to update a Minute Book, look to the small business tax experts at FBC. We can help look after the Minute Book and take care of payroll, financial planning, and financial statements.
For more information on FBC and the services we offer, call us today at 1-800-265-1002 or submit an online form and an FBC tax specialist will contact you at your earliest convenience.