Maximizing GST/HST recovery when selling your business
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In this episode, join host Danvir Roopra, BDO’s National Tax Due Diligence Leader and Tax Private Equity Leader, as he discusses strategies for maximizing GST/HST recovery when selling a business with guests Darren Taylor and Shelley Smith, Partners in BDO Canada's indirect tax practice. The discussion focuses on early planning and structuring to ensure the recovery of sales taxes on expenses related to selling a business, the importance of proper documentation, and special rules applicable to holding companies and other entities involved in such transactions. Tune in for an insightful discussion to maximize your GST/HST recovery.   Guest information: Host: Danvir Roopra, National Tax Due Diligence Leader and Tax Private Equity Leader) Guests: Darren Taylor, Partner, Indirect Tax) Shelley Smith, Partner, Indirect Tax)   What you’ll hear in this episode: [2:16] The importance of planning and structuring to ensure sales tax recovery. [4:19] Advice for business owners on maximizing ITC recovery and sales tax recovery when preparing to sell their business. [6:38] Explanation of special rules for business owners to obtain maximum tax recovery. [12:06] Summary points for business owners contemplating selling their business. [14:40] Strategies for maximizing ITC before a sale and common mistakes to avoid in transactions. [18:15] The differences in sales tax rules across various Canadian jurisdictions.   Quotes “The first point of advice I can give is plan, plan, plan. Make sure you have the proper planning in place, and the proper structure in place before you go ahead and sign contracts with your accountants, with your lawyers, with your brokers, et cetera.” “It's really helpful to, in advance, in contemplation of selling a business, maybe to do a diagnostic, a sales tax review, to make sure all of the issues hiding away in the closet that might come out and have to be resolved as part of a due diligence process.” “The dollars can be significant, especially when you look at lawyers, structuring accountants, valuation opinions, so on and so forth. There's considerable resources being invested in acquisition or takeover of businesses.” “…for anyone who is contemplating selling their business. One is to be careful who is signing the engagement letter for the work, which entity within the group is signing. Again, because GST and HST is very document driven, that is a very important factor.” "Don't forget about the sales tax. It's important. It's recoverable if things are set up properly."