How to Open a Business Bank Account in Canada

The path in one paragraph

Nobody can force you to open a business bank account as a sole proprietor in Canada — but the moment money starts arriving under your business name, you will want one. The process is: gather your ID and business-name documents, pick an account whose fee structure matches how you actually get paid, open it (in-branch or online depending on the bank), and then run every dollar of business income and expense through it so your tax records stay clean.

Step 1: Decide whether you actually need one

Start with the honest answer: no law requires it. A sole proprietorship is you, legally speaking, so your personal account is legally your business's account. Plenty of freelancers run for years on a second personal chequing account and do fine.

Get a real business account when any of these are true:

• Clients pay your business name, not your name. A cheque payable to "North Star Plumbing" generally cannot go into Jane Smith's personal account. Banks match the payee name to the account holder, and a mismatch means a rejected deposit.
• You want CRA-proof records. The CRA does not require a separate account, but when every business transaction flows through one account, your bookkeeping — and any future audit — gets dramatically simpler.
• You want to look established. Invoices paid from, and e-Transfers sent from, an account in the business name read differently to clients and suppliers.

If none of those apply yet — you invoice under your own name and get paid by e-Transfer to your personal email — a free second personal account is a legitimate starting point. Upgrade when the business name starts appearing on payments.

Step 2: Gather your documents

Banks verify you under federal anti-money-laundering rules, so the document list is not negotiable. For a sole proprietor, expect (per Scotiabank's published business-account requirements):

• Government-issued photo ID — driver's licence, passport, or permanent resident card.
• Proof of your business name — required when you operate under any name other than your own legal name. A provincial trade name registration certificate, a municipal business licence, or incorporation documents all qualify. Operating as exactly "Jane Smith" with nothing added? Your ID is enough.
• CRA Business Number — only if you have one (you get one when you register for GST/HST, payroll, or import/export). No BN yet? That is normal for a new sole proprietor under the $30,000 GST/HST threshold.
• Proof of address — a recent utility bill, bank statement, or lease in your name.

If you have not registered your business name yet, do that first — our sole proprietorship guide walks through provincial registration and the CRA business number, and the certificate it produces is the document the bank will ask for.

Applying online? You will type the same information: full legal name, address exactly as it appears on your photo ID, date of birth, and SIN.

Step 3: Pick the account

Entry-level business chequing in Canada is cheaper than its reputation. Verified figures from the banks' own published fee schedules (checked October 2026 — banks change these, so confirm before you open):

Beyond the big banks, credit unions often price small-business accounts competitively and are worth a quote if you like branch service, and digital-first business accounts exist for founders who never want to visit a branch.

Match the account to how you get paid, not to the monthly fee:

• Paid mostly by e-Transfer or direct deposit, rarely touch cash or cheques? A low monthly fee with unlimited electronic transactions (the BMO-style plan) wins.
• Low volume — a handful of transactions a month? A $6 pay-per-transaction plan can cost less in practice than a higher flat fee with bundled transactions you never use.
• Handle cash or paper cheques regularly? Price the deposit fees per item and per $1,000 of cash — these add up fast and vary the most between banks.
• Take card payments in person? Ask how the account pairs with the bank's merchant services (Moneris at BMO and RBC, Chase at Scotiabank) — settlement speed to your account matters for cash flow.

Step 4: Open it — in-branch or online

Two routes, and the bank chooses more than you do:

• In-branch appointment. Still the standard path at most big banks for business accounts: a staff member verifies your original documents, you sign the account agreements, and the account is typically usable the same visit. Book ahead — appointment availability, not paperwork, is usually what sets the timeline.
• Online opening. BMO's online platform accepts sole proprietors and single-owner corporations for new business accounts, and has run promotions waiving monthly fees for the first months of online openings. Other banks vary by account; their small-business pages say which accounts can be opened online.

Either way, bring or upload originals, not photocopies — a missing trade name certificate is the single most common reason an opening appointment fails.

Step 5: Run it right from day one

The account only earns its keep if the money discipline holds:

1. Everything business goes through it. All client payments in, all business expenses out. Pay yourself by transferring a fixed amount to your personal account — that transfer is your "paycheque" and it makes your income dead simple to track.
2. Keep records the CRA way. Bank statements plus invoices and receipts, kept for six years after the tax year they relate to. One account means one clean paper trail.
3. Connect it to your bookkeeping. Most accounting software links directly to Canadian bank accounts and auto-imports transactions — set that up in the first week, not at tax time.
4. Revisit the plan yearly. A $5/month account that fit 20 transactions a month may not fit 200. Banks let you switch plans; the expensive mistake is outgrowing your transaction bundle and paying per-item fees for a year before noticing.

And one thing the account does not do by itself: build your credit file. A long, clean banking relationship helps when you apply for business credit later, but the heavy lifting is on the credit side — see our guide to building credit in Canada for that half of the picture.