Tax aspects of corporate reorganisations
Corporate reorganizations may generate tax consequences, which can be more or less considerable. Most of the time, it is possible to avoid or at least defer those consequences with an appropriate planning.
Share exchanges or share conversions, in the context of a reorganization of capital, may, under certain conditions, be carried out without any tax impact. The tax consequences ensuing from a sale of assets or shares, to a taxable Canadian corporation, can be deferred by complying with the rules that apply in this regard. A merger between a corporation and its subsidiary, in which the former holds an interest of at least 90%, may essentially be carried out without any tax consequences. The same applies to the liquidation of a subsidiary in which the parent company holds an interest of at least 90%.
In the area of reorganizations, LJT’s tax team has acquired a great deal of experience in implementing many structures involving corporations, partnerships (LPs and GPs) and trusts. Whatever your needs in this regard, our lawyers will be able to design and recommend the most advantageous tax solutions.