A business purchase or sale is either a share transaction or an asset transaction
  • a share sale is generally more beneficial to a seller due to the possibility of Tax Planning, for example, use of a lifetime capital gain exemption, and
  • an asset sale is generally preferred by a buyer due to reduced liability exposure by buying company assets instead of a corporation itself together with its obligations and liabilities.

Our lawyers will work with your accountant to devise the most advantageous option for your business acquisition or sale. This is often determined by balancing ongoing financing requirements, liability concerns and tax consequences.

Due diligence

It is always strongly advised that the buyer does a due diligence, so that the buyer by acquiring shares or assets only acquires seller’s liabilities the buyer wishes to acquire and not the ones that the buyer does not.  The buyer should obtain information and review:

  • Financial statements;
  • Minute book;
  • Agreements in place;
  • Existing financing and outstanding security;
  • Trade liabilities and accounts payable;
  • Statutory liabilities such as:
  • Canada Revenue Agency for Income Tax, GST and Payroll Deductions;
  • WorkSafe BC;
  • BC Provincial Sales Tax;
  • Employment Standards

 Contact us at 604-669-6580 or arrange a meeting using our contact form to discuss your anticipated business purchase or sale.