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Pre-incorporation expenses are costs you pay before your company legally exists, and for GST/HST the key fact is that a corporation’s registration can’t start before its incorporation date. That shapes what you can claim back, so keep every receipt and sort the costs into two piles.
What counts as a pre-incorporation expense?
Anything paid to get the business going before the certificate is issued. Legal and accounting fees for the incorporation itself, a domain name, a laptop, a deposit on premises. The trouble is that the company wasn’t there to buy any of it, so the invoice usually has your name on it.
Whether the corporation can later take these costs over, and how, is a legal and accounting question we can’t settle for you, and the answer can differ for a laptop and for a lawyer’s bill. Ask before the first year end, not after it. We couldn’t confirm the accounting treatment under Canadian standards from a source we trust, so we’re not going to guess at it here.
Which costs can you claim GST/HST on?
The CRA’s guidance separates things you own from services already supplied. A new registrant can claim input tax credits (ITCs) on capital property and inventory on hand on the day it registers, as explained on the CRA’s input tax credits page. For start-up services already supplied before registration, the CRA’s older guidance says no credit is generally available.
| Type of cost | GST/HST credit after registering |
|---|---|
| Laptop or equipment still on hand at registration | May be claimed |
| Inventory on hand at registration | May be claimed |
| Services already supplied before registration | Generally not |
| Incorporation fees, legal and accounting | Depends, see the CRA guidance |
| Time limit for most businesses | 4 years after the reporting period |
The CRA guidance on start-up costs mentions incorporation fees as a possible exception, but it refers to rules that have been revised since. Read the current wording, or ask your accountant, before you count on it.
What does that look like in dollars?
You buy a $2,000 laptop for the business in Ontario before incorporating. The GST/HST calculator shows $260 of HST on it. If the corporation ends up owning the laptop and registers while it’s still on hand, that $260 may be claimable. If the company never took the laptop over, or nobody can show who owns it, don’t count on the credit.
That’s why a short written note matters: what was bought, when, from whom and who now owns it.
A simple way to keep track is a one-page list, started the day you pay your first bill. Columns: date, what it was, who it was from, amount, tax paid, and a line saying whether the business or you personally still owns it. Add the receipt number. Even a loonie-sized purchase goes on it, because a pile of small ones is what ends up hard to reconstruct.
Do you have to register for GST/HST right away?
Not necessarily. A small supplier, meaning a business whose taxable sales stay at or under $30,000 over four calendar quarters in a row, doesn’t have to register, though it may choose to. Many new owners register early so they can claim credits on what they buy. The trade-off is that you then charge tax from your effective date. If your first customers are individuals who can’t claim it back, think about how a 13% bump in Ontario will land with them. The CRA’s registration page spells out the timing.
Is the fee itself deductible?
Here the answer changes with who you are, so take it slowly.
For a sole proprietor, the CRA allows a deduction for accounting and legal fees for records advice and for filing returns. It says fees to buy a capital property aren’t deducted but added to the property’s cost. The CRA page we read doesn’t mention incorporation fees, so we can’t tell you how they’re treated for the new company. That’s a good question for whoever files your first corporate tax return.
What mistakes cost people money?
Mostly the boring ones, and they add up over a first year when nothing feels urgent.
Paying from the personal account with no record, then trying to reconstruct it a year later. Assuming the company can claim everything. And waiting on registration when you’re already selling. Once the business earns, remittances start too, and the payroll remittance calculator covers the part that trips up new employers.
If you’re the only owner and pay yourself, the dividend tax calculator helps compare that route with salary.
The sources behind this page
The GST/HST points come from CRA guidance on registrants and input tax credits, read in September 2026. One CRA publication on start-up costs is older and its rules may have changed. Tax figures are from this site’s calculators. No level of government runs or endorses this site.
Frequently asked questions
Can a corporation claim expenses paid before it existed?
It depends on the cost. For GST/HST, the CRA says a new registrant may claim credits on capital property and inventory on hand at registration.
Can GST/HST registration start before incorporation?
No. A corporation's effective registration date can't be before its incorporation date.
How long do I have to claim an input tax credit?
For most businesses, by the due date of the return for the last reporting period ending within four years after the period the credit could first be claimed.
Are incorporation legal fees deductible?
We couldn't confirm this from a current CRA page. Ask the accountant who files the first corporate return.
What should I keep?
Receipts showing what was bought, the date, the supplier and who now owns it.
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