The complete guide to small business funding in Canada

Small business funding in Canada comes in four main forms: grants, loans, tax credits and wage subsidies. It is offered by the federal government, the provinces, regional development agencies, Crown lenders, utilities, cities and non-profit partners. Most of it pays for a specific project, such as hiring, exporting, research or new equipment, rather than everyday costs, so the fastest way to find what fits is to start with what you want to do and check your business against the programs.

This guide walks through the types of funding, who offers it, what it pays for, how to find a match, how to apply and how to stay clear of scams. Every program we mention has its own page with its current status, amounts and rules, so check the program page before you plan around it.

What types of small business funding exist in Canada?

The word "grant" gets used for everything, but the money behaves very differently depending on its type. Our short explainer on grants, loans and tax credits goes deeper; here is the overview.

• Grants. A grant is money you don't pay back, as long as you follow the agreement. Grants for businesses are less common than people think and usually cover only part of a project.
• Repayable contributions. A repayable contribution is paid back, often with no interest, on terms set in the agreement. Regional development agencies use them a lot for growth projects.
• Loans. A loan from a bank, a Crown corporation such as BDC, or a community lender. Many start-up and growth programs are loans, sometimes paired with mentoring.
• Tax credits. A tax credit lowers the tax you owe after you spend on eligible work. A refundable tax credit can be paid out even when you owe no tax.
• Wage subsidies. A wage subsidy pays part of a new hire's wages, most often for students, youth or people facing barriers to work.
• Rebates. A rebate gives some money back after you buy something specific, such as efficient lighting or equipment.

Almost all of these are cost-sharing: the funder pays a share and you pay the rest. Each program sets its own share of costs, so check the program page.

Who offers funding to small businesses?

Funding comes in layers. Knowing the layers helps you search in the right places; our post on federal, provincial and city funding layers explains how they fit together.

1. Federal departments and agencies. National programs for exporting, research, innovation and hiring, such as CanExport SMEs and Canada Summer Jobs.
2. Regional development agencies. A regional development agency delivers federal business funding in one region, such as PacifiCan in British Columbia or FedDev Ontario and FedNor in Ontario.
3. Provinces. Provincial ministries run their own business, training and regional funds. See our guides to funding in British Columbia and funding in Ontario.
4. Crown lenders. BDC lends to Canadian businesses, including through the BDC online small business loan.
5. Utilities. Electricity and gas utilities offer rebates and incentives for energy-saving upgrades.
6. Delivery partners. A delivery partner is an organization that runs a program for a funder, such as a local business centre or a community lender.

You can browse everyone who funds programs on CanGrant on the funders page.

What can small business funding pay for?

Most funding is tied to a purpose. Here are the main topics and where to start for each.

Hiring and wages

Wage subsidies help you add staff, especially students and young people. Canada Summer Jobs funds summer jobs for youth, and other programs fund student work placements and internships. Start with our guide to wage subsidies and hiring programs, the post on hiring a student with a wage subsidy and the hiring topic page.

Exporting

If you are selling outside Canada for the first time or entering a new market, CanExport SMEs helps pay for market development work such as trade shows, market research and travel. Read export funding for your first market and browse the export topic page.

Research, technology and innovation

Two federal tools come up again and again. NRC IRAP offers advice and funding for technology projects at growing firms. SR&ED tax incentives give tax credits for eligible research and development, claimed through your tax return. Many businesses use both; see SR&ED vs IRAP and the innovation topic page.

Growth and scale-up

Growth funding, often a repayable contribution from a regional development agency or a provincial fund, helps established businesses expand, buy equipment or raise productivity. See the growth topic page.

Starting up

True start-up grants are rare. Most help for new businesses is a loan, training or mentoring. Our guide on funding to start a business covers what really exists, and the start-up topic page lists programs.

Going digital and saving energy

Some programs help you adopt new software or tools, and utilities help pay for efficient equipment. See funding to go digital and the digital and energy topic pages.

Is there funding for women, Indigenous, Black, young or newcomer entrepreneurs?

Yes. Some programs are set aside for particular groups, and some are run by organizations that serve those communities. A set-aside is a program or stream reserved for one group. Read the posts on funding for women entrepreneurs, Indigenous entrepreneurs, Black entrepreneurs, young entrepreneurs and newcomers starting a business, or browse the pages for women, for Indigenous people, for Black entrepreneurs, for youth and for newcomers.

How do I find funding that fits my business?

Searching program by program is slow. A better order:

1. Name the project. Write one sentence about what you want to do and roughly when. Funders fund projects, not businesses in general.
2. Know your basics. Your province, whether you are incorporated or a sole proprietor, your business number, how long you have operated and how many people you employ. Many rules turn on these.
3. Run the check. The funding check asks a few questions and shows programs that fit, ordered by fit and deadline only. Nobody pays to rank higher.
4. Read the rules carefully. Our guide on how to read eligibility rules shows what the common terms really mean.
5. Watch deadlines. Some programs take applications year-round on continuous intake; others open for a short intake. See what is closing soon.

You can also browse the full program list or the pages for small businesses.

How do I apply for small business funding?

The steps are similar across most programs.

1. Read the applicant guide from start to finish before you write anything.
2. Don't spend before approval. Most programs won't pay for costs you took on before your agreement, unless the program clearly allows retroactive costs. Read apply before you spend.
3. Build a clear budget that lists only eligible costs and shows your own share. Our grant project budget guide walks through it.
4. Write a focused application. Explain the problem, the plan and the result. See how to write a grant application and use the grant application checklist.
5. Check stacking rules if you plan to use more than one program for the same project. See can you combine grants? and the glossary entry on stacking.

After you apply, expect a review, then a contribution agreement if approved, then claims and reports. Read what happens after you apply and getting paid: claims and reports.

How do I avoid small business grant scams?

Scams prey on the idea of "free government money". Warning signs include:

• a fee to apply, to "unlock" a grant or to "guarantee" approval;
• promises of money for anything, with no project and no rules;
• pressure to act today, or contact out of the blue by phone, text or social media;
• websites or ads that copy government logos or claim to be government.

Read how to spot a grant scam and our scam tips. It also helps to know the common small business grant myths. If you are thinking about paid help, read should you hire a grant writer? first.

CanGrant is independent and free. We are not the government and we don't take applications; each program page links to the funder, where you apply.

Frequently asked questions

Are there free government grants to start or run a small business?

Some grants exist, but they are usually for a specific project and cover only part of the cost. Most help for small businesses is loans, tax credits, wage subsidies or repayable contributions. Use the funding check to see what fits your situation.

Can I get funding for costs I already paid?

Usually not. Most programs only cover costs after your application is approved or your agreement is signed. A few allow earlier costs; the program page and applicant guide will say so.

Do I need to be incorporated to get business funding?

It depends on the program. Some require an incorporated business, while others accept sole proprietors or partnerships. Check the eligibility rules on each program page.

Can I use more than one program for the same project?

Often yes, but most programs limit how much total public funding a project can receive. Tell each funder about your other funding and read the stacking rules.

How much funding can my business get?

Each program sets its own amounts and share of costs, and they change. Check the program page, where the amounts are taken from the funder's own words and re-checked.