Download Clearline Consulting’s summary of the tax measures announced in the Budget on March 28, 2023 now. You are welcome to tailor the content provided for your Firm’s newsletter or email to clients. We hope you find the summary useful as we all navigate these busy times.
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The amendments to the intergenerational share transfers appear to be very beneficial to any shareholder that is considering a succession plan using children, grandchildren, and nieces and nephews. It will be important that their shareholdings are structured correctly to achieve both their business succession and estate plans. Further a “purification strategy” should be introduced to ensure that these companies are qualified small business corporations, which is a requirement for these rules.
The employee ownership trust rules are another option to allow for the succession of a business. Though these might have a more limited applicability due to the requirement for the trust to acquire a controlling interest in the business (versus a minority interest today), these rules may work in the right circumstances. Again, ensuring that there is an appropriately planned purification strategy is important.
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Please contact Shane Schepens at Clearline Consulting if you would like to discuss your client’s situation or would like our assistance with a reorganization to meet their succession objections while minimizing the tax burden to the shareholders.