The most significant aspect of Bill C-208 is that it intends to equalize intergenerational and third-party transfers of businesses. This can offer family business owners significant peace of mind when succession planning by helping to create and maintain intergenerational prosperity and preserving a business’ legacy.
Bill C-208 can play an important role helping communities to thrive. When family businesses can stay within the family and succession isn’t detrimental, communities can maintain their unique identities and prosper through employment opportunities.
The Department of Finance intends to make amendments that protect the integrity of Bill C-208 and protect against artificial tax planning. The government plans to work on amendments that will apply to the later of November 1, 2021 or the date of the legislation’s publication.
Bill C-208 is now in effect, but as noted, changes are expected. You should proceed with caution when planning your business’ succession to the next generation, as transactions other than a genuine transfer may carry risk.
Bill C-208 is a boon to family businesses and the communities they support. Our hope is that there is ongoing government support for Bill C-208 and that its intentions continue to be honoured.
Bill C-208 offers significant benefits for family businesses. Our advisors can help you with a range of considerations—from determining optimal shareholding structures to determining if your business qualifies.
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