Owners of family businesses will gain new tax advantages from a bill that has just passed and is expected to come into effect shortly.
Currently, selling your business to a complete stranger gives you tax benefits that you would lose if you sold to a family member. Bill C-208 extends these benefits to cases where shares in an active business are transferred to a company that is owned by a child, grandchild, or sibling. The sale of shares would now be treated as a capital gain instead of a dividend, meaning you would be taxed at a lower rate and potentially be eligible for the lifetime capital gains tax exemption.
If you’re planning on handing down your family business to the next generation, we can help minimize your tax burden so you can invest your money in your future instead. Get in touch with our Business Tax Planning Team to learn how we can go #FurtherTogether.