Understand Employee Ownership Trusts and Their Role in Family Business Transitions.
For many family businesses, the eventual retirement of its founder(s) often results in the sale of the business toa new unrelated owner, or perhaps a transfer to another–usually younger–owner within the family. However, what if a group of employees wants to take over the business instead? Recent income tax changes in Canada have introduced the concept of an “Employee Ownership Trust” for the purpose of facilitating the transfer of businesses to employees. In this course, we will examine the tax implications and various other considerations relevant when a family business is transferred toits employees through the use of an Employee Ownership Trust.
Topics covered include:
• Different business structures in Canada• Potential options for selling or transferring a family business toa new owner• Compare and contrast tax implications from: sale to a 3rd party, sale to a family member, intergenerational business transfer, qualifying transfer to an Employee Ownership Trust (“EOT”)• Example scenario to illustrate application• Benefits of a transfer to an EOT• Review of technical rules–EOT conditions, qualifying business, beneficiaries, trustees• $10M exemption from capital gains on qualifying transfer to an EOT
Educator and Tax Advisor
Alex Garber, CPA, CA, MTax has been working in public accounting since 2004, focusing primarily on income taxation for Canadian owner-managed businesses and their shareholders. Alex presents PD seminars for CPA Ontario and facilitates at the CPA Canada In-Depth Tax Program. Alex is also a faculty member at the Schulich School of Business, York University, where he teaches income taxation at both undergraduate and master's levels. Alex started his career with Deloitte and Touche LLP in Toronto. He is currently an independent tax advisor, assisting various clients, sole-practitioners and CPA firms in Ontario.
Provincial regulators of CPAs in Canada do not require that independent providers of CPD be approved to offer courses. Instead, individual CPAs are responsible for assessing whether a CPD activity meets their requirements, and may take activities from any source provided those requirements are met.
Every course offered on LearnFormula is delivered by a qualified subject matter expert or learning organization, and advances learning objectives that are relevant to the responsibilities or professional competencies of Canadian CPAs. All activities on LearnFormula are quantifiable in terms of hours, and are also verifiable, in that users receive documented evidence of their attendance via a certificate of completion after finishing a course (and this certificate is stored by LearnFormula indefinitely). Nearly 100,000 Canadian CPAs successfully satisfy their CPD requirements via LearnFormula on an annual basis.
