Selling your family business?
Do you have a family owned business? Do you already have a succession plan that includes a family trust or a holding company? Are you maximizing your $800,000 lifetime capital gains exemption? If you are just thinking about this, or you already have an arrangement set up, but don’t know what to do next, its important you seek out help from a professional chartered accountant. A CPA will help you plan the right way to use these structures to not only save tax, but to also ensure that you don’t get caught in any Canada Revenue pitfalls.
For example, if you own the shares of your operating business directly (i.e. not through a holding company) and want to sell / transfer the shares to a corporation that is owned by another family member or spouse, you have to ensure the transaction is done properly. Normally you would expect this transaction to be tax free, but if the structure is not set up correctly, the sale/transfer can be denied by the CRA and you end up paying tax!
Contact us for more information. It’s important you get the right tax advice for your situation.