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Research & development, government incentives
Are you developing innovative processes or products, undertaking experimentation or solving technological problems? If so, you may qualify to claim SR&ED tax credits. This Canadian federal government initiative is designed to encourage and support innovation in Canada. Our R&D professionals are a highly-trained, diverse team of practitioners that are engineers, scientists and specialized accountants.
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Indirect tax
Keeping track of changes and developments in GST/HST, Quebec sales tax and other provincial sales taxes across Canada, can be a full-time job. The consequences for failing to adequately manage your organization’s sales tax obligations can be significant - from assessments, to forgone recoveries and cash flow implications, to customer or reputational risk.
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US corporate tax
The United States has a very complex and regulated tax environment, that may undergo significant changes. Cross-border tax issues could become even more challenging for Canadian businesses looking for growth and prosperity in the biggest economy in the world.
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Cross-border personal tax
In an increasingly flexible world, moving across the border may be more viable for Canadians and Americans; however, relocating may also have complex tax implications.
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International
While there is great opportunity for businesses looking to expand globally, organizations are under increasing tax scrutiny. Regardless of your company’s size and level of international involvement—whether you’re working abroad, investing, buying and selling, borrowing or manufacturing—doing business beyond Canada’s borders comes with its fair share of tax risks.
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Transfer pricing
Transfer pricing is a complex area of corporate taxation that is concerned with the intra-group pricing of goods, services, intangibles, and financial instruments. Transfer pricing has become a critical governance issue for companies, tax authorities and policy makers, and represents a principal risk area for multinationals.
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Succession & estate planning
Like many private business owners today, you’ve spent your career building and running your business successfully. Now you’re faced with deciding on a successor—a successor who may or may not want your direct involvement and share your vision.
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Tax Reporting & Advisory
The financial and tax reporting obligations of public markets and global tax authorities take significant resources and investment to manage. This requires calculating global tax provision estimates under US GAAP, IFRS, and other frameworks, and reconciling this reporting with tax compliance obligations.
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Transactions
Our transactions group takes a client-centric, integrated approach, focused on helping you make and implement the best financial strategies. We offer meaningful, actionable and holistic advice to allow you to create value, manage risks and seize opportunities. It’s what we do best: help great organizations like yours grow and thrive.
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Restructuring
We bring a wide range of services to both individuals and businesses – including shareholders, executives, directors, lenders, creditors and other advisors who are dealing with a corporation experiencing financial challenges.
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Forensics
Market-driven expertise in investigation, dispute resolution and digital forensics
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Cybersecurity
Viruses. Phishing. Malware infections. Malpractice by employees. Espionage. Data ransom and theft. Fraud. Cybercrime is now a leading risk to all businesses.
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Consulting
Running a business is challenging and you need advice you can rely on at anytime you need it. Our team dives deep into your issues, looking holistically at your organization to understand your people, processes, and systems needs at the root of your pain points. The intersection of these three things is critical to develop the solutions you need today.
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Creditor updates
Updates for creditors, limited partners, investors and shareholders.
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ASPE Sec. 3041 Agriculture Understanding and applying the new ASPE Section 3041 AgricultureThe Canadian Accounting Standards Board (AcSB) has released new guidance on recognizing, measuring and disclosing biological assets and the harvested products of bio assets.
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Tax alert Agricultural Clean Technology ProgramThe Agricultural Clean Technology Program will provide financial assistance to farmers and agri-businesses to help them reduce greenhouse gas (GHG) emissions.
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Tax alert ACT Program – Research and Innovation Stream explainedThe ACT Research and Innovation Stream provides financial support to organizations engaged in pre-market innovation.
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Tax alert ACT Program – Adoption Stream explainedThe ACT Adoption Stream provides non-repayable funding to help farmers and agri-business with the purchase and installation of clean technologies.
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Builders And Developers
Every real estate project starts with a vision. We help builders and developers solidify that vision, transform it into reality, and create value.
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Rental Property Owners And Occupiers
In today’s economic climate, it’s more important than ever to have a strong advisory partner on your side.
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Real Estate Service Providers
Your company plays a key role in the success of landlords, investors and owners, but who is doing the same for you?
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Mining
There’s no business quite like mining. It’s volatile, risky and complex – but the potential pay-off is huge. You’re not afraid of a challenge: the key is finding the right balance between risk and reward. Whether you’re a junior prospector, a senior producer, or somewhere in between, we’ll work with you to explore, discover and extract value at every stage of the mining process.
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Oil & gas
The oil and gas industry is facing many complex challenges, beyond the price of oil. These include environmental issues, access to markets, growing competition from alternative energy sources and international markets, and a rapidly changing regulatory landscape, to name but a few.

If you are selling your business, your goals should dictate your approach to everything from corporate structure to tax planning. There are many ways to structure M&A transactions, each with different tax implications, so the decision of how to sell is just as important as what to sell.
Engage in business planning before negotiations go too far
There are any number of reasons to sell a business, whether personal, strategic or commercial. Understanding what is important to you and how the sale fits into your overarching strategy and objectives is an essential first step in the planning process. Does the business have special meaning to you? For example, is it a family business? Do you consider it to be a strategic asset?
Although basic, these questions will influence the entire transaction, and help you optimize after-tax returns. Those tax implications can then inform your decisions concerning the pricing, conditions, schedule, and structure of the deal. In certain circumstances, the right planning can impact the net return on a sale by 10-15% -- a significant margin.
It is also important to understand that business planning should take place before the negotiations become too advanced. Once you’ve signed a letter of intent, it may be too late to make key decisions on the transaction which will maximize tax efficiencies on the overall sale.
Once negotiations are underway, you may be surprised at how quickly they unfold – the process often takes less than two months. This does not leave much time for corporate planning, so there is a balance to strike as a seller. While you don’t want tax planning to drive you’re planning as a vendor and other strategic considerations, it is still a good idea to be proactive, and not be inhibited from taking decisive action for tax reasons later on. We recommend that you start with a clear outline of your corporate objectives and optimize tax results accordingly.
While buying takes months, selling takes years. If you are the seller, you should think about the possibility of M&A at least three years in advance because this will help determine how your business grows. In contrast, buyers are usually responding to market dynamics, although they will also have long-term objectives of their own.
Understand the buyer’s motivations
As a seller, you should have a strong understanding of the value of your business, your role in the market, and what intangible factors may motivate prospective buyers. For example, some buyers are motivated by competitive factors, and will place a premium on their competitive position. These factors are quantifiable and should be well understood before the terms of the transaction are settled.
Although buyers respond to market opportunities, they also engage in long-term planning. A significant part of their strategic plan may include buying businesses to achieve their objectives. So, this is not usually a spontaneous decision, as the buyer will be identifying targets in advance.
The buyer’s strategic motivations will usually include one, or more, of the following:
- The targeted business is in the same sector, perhaps as a key supplier;
- The targeted activities are innovative and show significant promise;
- The acquisition may lead to economies of scale and increased profitability;
- There are competitive advantages to be gained in a geographic area; and
- The acquisition is done sooner than intended due to intense M&A activity in a sector or a geographic area.
Another important consideration in a buyer’s decision to proceed with the acquisition is whether they are capable of assimilating the target business. Although the business may seem attractive for strategic reasons, the acquisition is only advisable if the buyer has the capacity to see it through. Otherwise, they risk becoming overwhelmed if their new, sudden growth isn’t structured properly.
While this may seem counter-intuitive if you are the seller you shouldn’t focus on the transaction structure until you fully understand the buyer’s motivations. This is because it’s difficult to negotiate without compromising the value of what you’re trying to sell. So, you have better odds of maximizing your position once you truly understand what the buyer wants.
What does the transaction look like?
Once you decide to sell your business, you should consider the after-tax return on proceeds. The number of vendors may have an impact on the capital gains exemptions that are available. Further, a tax deferral may be available depending on the nature of the proceeds. The reason for this deferral is to match tax obligations with cash flows and ensure you don’t incur unexpected tax liabilities while holding relatively illiquid assets.
As well, to the extent the sale proceeds include a contingent or earn-out component, which allows the seller to participate in the future growth of the company, such a component can be taxed as a capital gain or regular income. The outcome depends on how it is earned or realized.
Usually, it is more advantageous for a seller to sell an equity interest and for a buyer to buy assets. For each side, this choice comes with certain tax advantages. Although this is the basic dynamic at play in M&A, transactions are becoming increasingly complex in today’s competitive environment. In fact, the question of whether a sale involves equity or assets is sometimes a hard one to answer, and your professional tax advisor may help you in making this choice and in optimizing the result.
The priority for your Grant Thornton tax advisor is to help you reach your long-term financial goals, at every step of the corporate journey. When done in advance, tax planning can both support and guide your decisions in a way that will maximize returns and help you avoid unexpected pitfalls. For more information, contact us.