Before You Pay: What to Verify About a Business in Canada

Before making any payment, consumers are encouraged to take reasonable steps to verify that a business is properly registered, operating legitimately, and meeting basic safety and compliance expectations. Verifying a business in advance can help reduce the risk of financial loss, prevent avoidable disputes, and identify potential warning signs before a transaction occurs.

This guidance outlines common verification considerations that consumers may wish to review prior to hiring a contractor, purchasing services, or engaging with a business in Canada. These considerations are intended to support informed decision-making by helping consumers better understand who they are dealing with, what documentation should be requested, and how to recognize indicators of higher-risk business practices.

While no verification process can guarantee outcomes, taking basic precautionary steps before payment can improve transparency, encourage fair business practices, and promote safer consumer transactions.

Consider Independent Verification for Higher-Risk Transactions

For larger payments, commercial services, or situations involving safety concerns, an independent verification review can provide additional clarity.

Independent verification may include:

Business registration confirmation
Tax and compliance checks
Insurance and safety coverage validation
Complaint and reputation analysis
Risk indicators and summary findings

This approach allows consumers to make decisions based on verified information rather than assumptions.

How the Canadian Consumer Verification & Safety Bureau (CCVSB) Can Help

The Canadian Consumer Verification & Safety Bureau (CCVSB) is an independent organization that provides business verification, safety reviews, and consumer documentation support.

Our services include:

Business and contractor verification reports
Compliance and safety checks
Consumer documentation review
Risk assessment summaries
Guidance on appropriate next steps

We support consumers by organizing information, identifying potential risks, and promoting informed decision-making.

Important Notice

This page is provided for general educational purposes only.
The Canadian Consumer Verification & Safety Bureau does not provide legal advice and is not a government agency. Verification information is based on available data at the time of review and does not constitute a guarantee of business performance.

Take the Next Step

If you are considering making a payment and would like independent verification support

→ Request a Business Verification Report

→ Submit a Verification Inquiry

→ Learn More About Consumer Protection Services

Why Verifying a Business Before Payment Matters

Many consumer disputes arise not because a service failed, but because a business was never properly verified in the first place. Common issues include unregistered operators, lack of insurance, misleading representations, unclear contracts, or businesses that disappear after receiving payment.

Verifying a business before payment helps consumers:

Confirm that a business legally exists
Identify whether basic compliance requirements are met
Reduce exposure to fraud and misrepresentation
Understand who is responsible if issues arise
Make more informed financial decisions

For higher-value transactions, commercial services, or work involving safety risks, independent verification can provide an additional layer of protection.

Confirm Legal Business Registration

A legitimate business operating in Canada should be registered either federally or provincially.

Consumers may wish to confirm:

The legal name of the business
Whether the business is active or inactive
The date of registration
Whether the business name used in advertising matches its legal registration

A mismatch between the name on a quote, invoice, or website and the registered legal entity may warrant further clarification.

Common warning sign:
Businesses that cannot clearly explain their legal business name or registration status.

Verify GST/HST/QST /PST/RST Registration (If Applicable)

If a business charges GST,HST,RST or QST, it should have a valid registration number issued by the Canada Revenue Agency.

Consumers may wish to:

Confirm that a GST/HST/RST/QST number exists
Verify that the number matches the business name
Be cautious if tax is charged without a verifiable registration

Common warning sign:
A business charging tax but unable or unwilling to provide a valid GST/HST/RST/QST number.

Request Proof of Insurance and Worker Coverage

For contractors and service providers performing physical work, insurance and worker coverage are critical for consumer protection.

Consumers may request:

Proof of commercial liability insurance
Confirmation of workers’ compensation coverage (such as WorkSafeBC in British Columbia or Workplace Safety and Insurance Board in Ontario)

These documents help reduce consumer liability if damage, injury, or accidents occur during work.

Common warning sign:
Claims of being “insured” without documentation or reliance on verbal assurances.

Review Quotes, Contracts, and Invoices Carefully

Written documentation helps clarify expectations and responsibilities before payment is made.

Consumers may wish to review:

Scope of work or services
Payment structure and deposit amounts
Timelines and deliverables
Warranty or service guarantees
Business contact information

Clear, professional documentation often reflects organized business practices.

Common warning sign:
Requests for payment without written documentation or refusal to provide a clear scope of work.

Check Public Feedback and Complaint Patterns

Online reviews and public complaints can provide insight into past consumer experiences. When reviewing feedback, consumers are encouraged to look for patterns, rather than isolated comments.

Consider:

Repeated complaints about similar issues
Unresolved disputes
Sudden clusters of reviews over a short period
Aggressive or unprofessional responses to feedback

Common warning sign:
Multiple complaints involving deposits, unfinished work, or lack of communication.

Be Aware of Common Red Flags

Certain behaviours may indicate increased consumer risk. These include:

Pressure to pay immediately
Requests for full payment upfront
Cash-only or untraceable payment methods
Refusal to provide documentation
Frequent name changes
Inconsistent business information
Claims that verification is “not necessary”

While not all red flags indicate misconduct, multiple indicators may warrant caution.