Owner-Operator LMIA Work Permit FAQ

Owner-Operator LMIA Work Permit FAQ

October 08, 2020

Service Canada announced that they are completely revising the Owner-Operator LMIA program, learn more in our article detailing the cancellation and contact us to learn more about your options in Canada.

Can I buy a business in Canada as a foreigner while on a tourist visa?

Yes, it is possible to own a business in Canada while being on a tourist visa. However, you will have to meet certain requirements and the laws differ depending on the type of business you buy as well as the province in which it will operate. Our team can assist you in finding a suitable business in Canada and buying an existing business in Canada or establishing your business from scratch.

Do I have to relocate to Canada once I purchase a business in Canada?

As a business owner, working in Canada with a valid work permit, it is expected that you will actively manage your business in Canada. Therefore, your presence in Canada is generally required. However, this does not mean that you cannot travel while working in Canada, especially if your business requires extensive traveling outside of Canada.

Do I have to receive a salary from my business in Canada under the Owner-Operator LMIA Work Permit? If yes, how much? 

Under the Owner-Operator Work Permit, as a manager of your business in Canada, you must pay yourself a salary that meets the Canadian median wage standards (around $58/per hour for senior executive roles in Ontario). What this means is that you will be responsible for paying all payroll deductions to the Canadian tax authorities of approximately $3,000 – $4,000 (per month) based on your senior executive salary.

Can I buy a business with a partner in Canada and get a work permit under the Owner-Operator LMIA Work Permit? 

Yes, you can buy a business with a partner or buy shares in an existing business in Canada. However, please keep in mind that only someone who is at least 51% owner of the business can apply for the Owner-Operator LMIA and receive a work permit to manage the Canadian business. The minority partner (if not a resident in Canada) will have to apply for a regular LMIA if he/she wants to relocate to Canada as a business partner as well.

Can I buy shares in the existing business and apply for the Owner-Operator LMIA (and get permanent residency later on)?

Yes, this is possible, but make sure that you buy at least 51% of shares in the existing company to benefit from the Owner-Operator LMIA program. Also, make sure that the company has been actively engaged in business for at least 12 months.

Do I have to prepare a business plan to support my Owner-Operator LMIA application? 

It is not mandatory to submit a business plan with your application for a work permit. However, we recommend having a business plan if your company in Canada is new or has not been active for the past 12 months.

Do I have to commit to hiring Canadian residents/citizens? What if I am not able to meet my hiring commitment?

One of the primary objectives of the Owner-Operator LMIA program is to create job opportunities for Canadian residents and citizens. Therefore, your inability to meet your hiring commitment plans may negatively affect your work permit extensions and/or permanent residence applications in the future. We recommend committing to hiring at least one Canadian employee to stay compliant with the objectives of the program.

Do I have to present a performance report to the Canadian immigration authorities to apply for permanent residency?

There are no performance reports, however, 50% of companies that have received a positive LMIA decision are audited by the IRCC for compliance. Therefore, it is very important to stay compliant with the conditions of your LMIA approval (including salary payment) and keep detailed records.

Also, one of the requirements that owner-operators must meet while applying for permanent residence is the genuineness of the job offer from your Canadian company, since the offer of employment is coming from their own company. To pass the genuineness test, the applicants must demonstrate that their company is actively engaged in business and that the owner of the company is indeed employed at the company in the senior executive role.

Can I work for another company while running my business in Canada?

No. Your work permit will be limited to your company in Canada, which means that you cannot work for any other company.

What if my Canadian company is not profitable in the first year?

 There is no legal requirement to be profitable. We all know that it takes time to build a profitable company. However, your company must be actively engaged in business, which means it must be offering services or goods to its customers in Canada or abroad. Also, your company must have a physical location (office or warehouse) and employ at least one Canadian employee.

Do I need to provide language test results to get a work permit under this program?

Business owners are generally not required to provide any proof of language skills. However, if they wish to transfer key personnel to Canada under this program, such employees may be required to provide English or French language test results to prove their suitability for the position in Canada.

Can my work permit be refused even if I get LMIA approved?

There is always a possibility of rejection of your permanent residency application due to various reasons, including criminality, medical inadmissibility, failure to meet the language requirements, etc. However, if your business immigration lawyer prepares a strong application package, you should have a good chance of work permit approval by the respective Canadian embassy/consulate.

What is the success rate of the Owner-Operator LMIA program?

We regularly request official statistics from the government of Canada regarding the approval rates for various immigration programs. The latest statistics for 2019 demonstrate the following:

  • Owner-Operator LMIA applications: approval rate – 95%
  • Work Permit (LMIA-based):
    • Approval rate varies, depending on the consulate/embassy handling your case. On average, we see a 70% approval rate. Please contact us to get specific statistics for your country.
  • Permanent residence applications (with a job offer): 80%-85%

Will you refund money if my work permit is refused?

Unfortunately, we cannot reimburse your money if your work permit application is rejected. We get paid for our work, not for the result. Although we are ambitious and results-oriented, the ultimate decision-maker is the Government of Canada and/or the respective Canadian embassy/consulate. What we do guarantee you is that with our 20+ years of combined experience in business immigration matters, we will prepare the strongest application possible designed to meet the criteria required by the IRCC.

Can I sell my business after I receive my permanent residence?

When supporting your permanent residence application, your company must guarantee the IRCC that your position will be available to you for at least 1 year after you become a permanent resident of Canada. Although there is no specific limitation on selling your business, the IRCC may interpret your sale of the business as a breach of undertaking by your Canadian business.

Is it possible to obtain permanent residency in Canada if I do not speak sufficient English or French?

In general, all applicants for permanent residence in Canada must possess sufficient language skills as set by the IRCC. However, in exceptional situations when applicants have strong ties to Canada and can demonstrate successful establishment in Canada, there is an opportunity to apply for permanent residency through other immigration programs. The success rate in these cases is usually 60%.

Does your law firm help with company establishment in Canada?

Yes, we assist our clients at every stage of the process starting with company registration, business plan preparation, setting up bank accounts, securing Nominee Canadian Director Services, and handling immigration applications (from work permit to permanent residency to Canadian citizenship) for our clients and their family members. We also provide guidance and assistance with compliance audits and entry interviews (if required) upon arrival in Canada.

What is the payment plan for your fees? Do you offer a discount for your fees? 

As licensed Canadian business immigration lawyers we follow the rules set by the Law Society of Ontario and charge the full retainer amount upfront. The entire amount will be deposited into our trust account and you will be billed once we complete working on your file.
As for discounts, we deem our legal fees as reasonable given the amount of work we put into each file and the quality of service we deliver. All business immigration applications are complex, and our legal fees fairly reflect the value of our work.

Do you have success stories, and can you share contacts of your former clients, so we can talk to them?

As licensed Canadian business immigration lawyers, we are obliged by law to keep all our clients’ information strictly confidential, including their names and the outcome of their applications. The Law Society of Ontario rules prohibit us from sharing any of our clients’ confidential personal information with third parties. You can review our website and read all the testimonials page where we share the experiences of our clients with their consent.