How to Incorporate as an Ontario Physician (MPC) — 10 Steps (2026)

Ontario physicians can incorporate as a Medical Professional Corporation (MPC) under the Ontario Business Corporations Act and Health Professions Procedural Code, redirecting OHIP and private billings through the corporation to access the small business corporate tax rate (~12.2% on the first $500K of active business income). This 10-step guide walks the 2026 process — including the CPSO Certificate of Authorization, family share provisions, and OHIP re-registration — used by Bader with Ontario family physicians, specialists, and locum practices.

1. Step 1: Confirm CPSO membership and Certificate of Authorization prerequisites

   Applicants must be members in good standing of the College of Physicians and Surgeons of Ontario (CPSO). Confirm no active complaints or suspensions. Review the CPSO Practice Guide on Health Profession Corporations. The Certificate of Authorization (CoA) is issued by CPSO after successful incorporation review and is required before billing through the MPC.

2. Step 2: Design the MPC share structure per Regulated Health Professions Act

   Voting shares must be 100% held by physician members of CPSO. Non-voting shares may be held by family members — spouse, parents, children, and children’s spouses — directly or through a family trust. Share classes typically: Class A voting participating (physician); Class B and C non-voting participating (spouse, adult children); Class D-F retractable preferred (future estate freeze). No non-physician can hold voting shares.

3. Step 3: Choose the corporate name and complete NUANS search

   Ontario Regulation prescribes MPC naming: must include the physician surname, “Medicine” or “Medical” descriptor, and “Professional Corporation” or “PC” suffix. Example: “Chowdry Medicine Professional Corporation”. Complete a NUANS report to confirm the name is available. Alternative: numbered corporation with a trade name — but CPSO strongly prefers named corporations.

4. Step 4: File OBCA Articles of Incorporation

   File Form 1 under the Ontario Business Corporations Act with the Ontario Business Registry. Include prescribed share terms, initial director (the physician), registered office, and NUANS report. Government filing fee is $300 online. Retain the certificate of incorporation, articles, and initial directors resolutions — required for the CPSO Certificate of Authorization application.

5. Step 5: Apply to CPSO for the Certificate of Authorization

   Submit the CPSO Certificate of Authorization application with: certificate of incorporation, articles of incorporation, share certificates, list of directors/officers/shareholders with CPSO numbers, and application fee. CPSO reviews for compliance with the Health Professions Procedural Code and issues the Certificate typically within 4-8 weeks. Do not bill OHIP or private through the MPC until the Certificate is issued.

6. Step 6: Register CRA program accounts

   Register the Business Number and RC (corporate tax) account. Register RP (payroll) if the physician will draw a T4 salary. HST is generally not applicable to physician services (exempt supplies under Part II of Schedule V of the Excise Tax Act), so RT registration is usually unnecessary — but confirm if you provide any HST-taxable services (medical-legal reports, expert witness fees, teaching contracts).

7. Step 7: Update OHIP billing and third-party payer records

   Notify Ministry of Health OHIP Registration to redirect OHIP billing payments to the MPC. Submit the MPC banking information and CPSO Certificate of Authorization. Update private insurer records (WSIB, workplace medical, private clinic contracts) to direct payments to the MPC. Continue physician-personal registration numbers — the physician remains the licensed provider.

8. Step 8: Open corporate bank account and set up bookkeeping

   Open corporate bank accounts (operating + investment) with certificate of incorporation, CoA, directors resolution, and BN. Set up QBO or Xero with a chart of accounts for a professional practice: OHIP receivables, private billings, locum income, wages, professional dues, insurance, CME, and office expenses. Establish monthly bank reconciliation and quarterly management review.

9. Step 9: Draft the physician-MPC employment agreement and compensation policy

   Physician provides medical services to the MPC as employee. Draft an employment agreement covering: duties, compensation mix (salary + dividend), benefits (health spending account, RRSP matching if any), and termination. Model salary-versus-dividend mix — most Ontario physicians take a modest salary (~$50-80K) for CPP/RRSP room plus dividends for the balance of after-tax needs.

10. Step 10: Set the annual compliance and estate planning calendar

    Diarize: T2 corporate return (6 months post fiscal year end); Ontario annual return (via T2 attachment); T4/T5 slips to physician/family (Feb 28); annual CPSO Certificate renewal; personal T1 filing; MPC minute book updates; and estate freeze planning at ages 45-55 to lock in current FMV and transfer growth to family via the non-voting share class.

Frequently Asked Questions

What is the difference between a PC and a MPC?

A Professional Corporation (PC) is the general Ontario Business Corporations Act structure for any regulated profession. A Medical Professional Corporation (MPC) is specifically a PC for a physician regulated by CPSO. The share structure and CoA rules are prescribed by the Regulated Health Professions Act for medicine.

Can my spouse own shares of my MPC?

Yes, but only non-voting shares. Voting shares must be 100% held by CPSO-registered physicians. Non-voting shares can be held by spouse, parents, children, or children’s spouses. Dividends to family members trigger Tax on Split Income (TOSI) rules unless an exemption applies.

What is the tax benefit of incorporating as a physician?

On the first $500,000 of active business income, the Ontario+federal corporate rate is ~12.2% versus personal marginal rates reaching 53.53% for income above $253K. A physician retaining $200K/year in the MPC saves roughly $55-75K in first-year tax versus billing personally — assuming retention rather than immediate withdrawal.

Do I need HST registration for my MPC?

Generally no. Most physician services are exempt from HST under Part II of Schedule V. Register only if you have taxable side income (medico-legal reports, expert testimony, teaching). Registering unnecessarily creates nil-return filing obligations.

How long does the CPSO Certificate of Authorization take?

Typically 4-8 weeks after CPSO receives a complete application. Delays occur when share structure documentation is incomplete, non-physician voting shares appear, or the applicant has an active CPSO investigation.

Authoritative Sources

• CPSO — Health Profession Corporations
• Ontario Regulation 39/02 — Health Profession Corporations
• CRA — Corporate income tax

Expanded technical guidance

Common pitfalls in MPC incorporation for Ontario physicians

• CPSO Certificate of Authorization lapse. The MPC must hold a valid CPSO Certificate of Authorization to bill OHIP. Certificate must be renewed annually; lapse voids OHIP billing rights and the MPC becomes a shell.
• Non-family-member equity holders. Ontario regulations restrict MPC shareholders to physicians, their spouses, children, and parents. Any non-family shareholder voids the corporate structure.
• Failing to distinguish practice income from investment income. Passive investment income in the MPC above $50K starts the SBD grind. Physicians commonly under-model this until it’s costing them.

Forms, filings, and deadlines

Incorporate via Ontario Business Registry (Ontario Business Corporations Act) with “Professional Corporation” or “PC” in name. Apply for CPSO Certificate of Authorization (annual renewal). Register with OHIP under corporate billing number. First T2 due 6 months after fiscal year-end. Physician’s spouse/adult child ownership permitted only if the shareholder is a family member per O. Reg. 39/02. Companion documents: CPSO Certificate, OHIP corporate billing enrolment, shareholders’ agreement, minute book, and CRA Business Number. Reference: Regulated Health Professions Act 1991 (Ontario), O. Reg. 665/05 (Business Corporations Act — Professional Corporations), CPSO Policy Statement #4-05.

Worked example — solo family physician $450K OHIP billings

Physician’s gross OHIP billings $450K. Practice overhead $150K. Net corporate income $300K. Physician’s personal salary $200K (funds RRSP contribution, mortgage). MPC retains $100K after tax at CCPC rate 15.4% (combined federal-Ontario SBD) = ~$85K net retained. Retained earnings compound tax-deferred until dividended out.

Worked example — MPC + IPP (Individual Pension Plan)

Physician age 45+ can set up an Individual Pension Plan through the MPC. IPP contributions are corporate-deductible and can exceed RRSP room by 15-30% for physicians over 50. Combine IPP with MPC salary strategy for maximum tax-deferred retirement savings.

Worked example — s. 85 rollover of practice goodwill into MPC

Physician rolls internally generated goodwill ($150K FMV, nil ACB) into new MPC under s. 85(1) with T2057. Elected amount = nil. MPC takes goodwill at nil ACB. Rolled-in property provides deferral: no personal capital gain, and MPC can amortize goodwill for accounting purposes (though no tax CCA on goodwill post-2016 s. 14 repeal).

Related Insight resources

Ontario physicians incorporating an MPC should read the Dr. X case study for the $47K first-year deferred tax outcome. Cross-border physicians face additional complexity — see the Dr. G cross-border MPC case study. If the incorporation involves rolling appreciated practice goodwill into the MPC, pair this guide with how to execute a s. 85 rollover and the eligibility checker tool.