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Academy/ Buying & Selling a Business/Ask an Expert

Ask an Expert for Buying & Selling a Business.

Real questions, answered plainly by people who do the work.

Am I liable for a seller's unpaid provincial sales tax when I buy a business? — Treadstone Academy

Am I liable for a seller's unpaid taxes when I buy a Canadian business? — Treadstone Academy

If a buyer offers my employees comparable jobs on an asset sale and they refuse, do I still owe them notice or severance? — Treadstone Academy

Are non-compete clauses in employee contracts enforceable in Quebec? — Treadstone Academy

Are non-compete clauses in employee contracts enforceable in Ontario? — Treadstone Academy

Are the outgoing directors of a company I’m buying personally liable for unpaid wages, and do incoming directors inherit that liability? — Treadstone Academy

Are professional corporation ownership rules the same across Canada? — Treadstone Academy

Are telecom and broadcasting foreign-ownership limits separate from Investment Canada Act review? — Treadstone Academy

Are there foreign ownership limits on a Canadian airline? — Treadstone Academy

Can a buyer's bank block vendor take-back payments over a default that has nothing to do with the note? — Treadstone Academy

Can a bankrupt seller’s trustee cancel a contract I’m relying on before I close? — Treadstone Academy

Can a buyer add its own expected synergies to the target’s EBITDA before pricing a deal? — Treadstone Academy

Can a buyer claim a multiple of earnings as indemnity damages, or only the dollar-for-dollar loss? — Treadstone Academy

Can a buyer recover twice for the same shortfall — once through a purchase-price adjustment and again through an indemnity claim? — Treadstone Academy

Can a buyer pay a key employee directly to sign a personal non-compete without creating a tax problem? — Treadstone Academy

If my target company’s employment contracts cap severance at the ESA minimum, can a buyer rely on that during due diligence? — Treadstone Academy

Can a buyer rely on a financial-statement representation if the seller's books are only 'Notice to Reader,' not audited? — Treadstone Academy

Can a buyer's deposit on a business sale be forfeited without the seller proving any actual loss? — Treadstone Academy

Can a buyer’s own lender block payment of an earn-out that has already been earned? — Treadstone Academy

Can a company refuse to pay a dissenting shareholder if it cannot pass the solvency test? — Treadstone Academy

Can a corporation redeem shares or pay a dividend if it cannot pass the solvency test? — Treadstone Academy

Can a creditor undo a payment made just before a business sale closes? — Treadstone Academy

Can a CSBFP lender charge a higher interest rate for a riskier acquisition loan? — Treadstone Academy

Can a family member hold shares in an Ontario professional corporation? — Treadstone Academy

Can a franchisor rebrand without franchisee consent? — Treadstone Academy

Can a government licence be transferred to a buyer without the current holder’s consent? — Treadstone Academy

Can an Ontario commercial landlord refuse consent to a lease assignment for any reason? — Treadstone Academy

Can a partnership hold a business licence, or does the regulator require an individual or a corporation? — Treadstone Academy

Can a private party sue over a merger or business practice the Competition Bureau declined to pursue? — Treadstone Academy

Can an old account receivable become legally uncollectible before a Quebec business sale closes? — Treadstone Academy

Can family members elect any price they want on a rollover into a holding company? — Treadstone Academy

Can you use a section 85 rollover if the buyer is a partnership or a foreign company? — Treadstone Academy

Can a seller keep adding back a “non-recurring” expense every year? — Treadstone Academy

Can a seller sue if the buyer manipulates the numbers that decide an earn-out? — Treadstone Academy

Can a sellers' representative clause bind a shareholder who never agreed to how a claim was settled? — Treadstone Academy

Can a seller be paid tax-free for signing a non-compete when selling their business? — Treadstone Academy

Can a spouse or adult child receive dividends from the family company without hitting the top tax-on-split-income rate? — Treadstone Academy

Can a supplier repossess inventory that is already listed as a deal asset when the seller is in receivership? — Treadstone Academy

Can a supplier or landlord cancel a contract just because the company filed for bankruptcy protection? — Treadstone Academy

Can a target keep earning a supplier volume rebate after being carved out of a larger buying group? — Treadstone Academy

Can a buyer reduce an earn-out by charging the acquired business its own corporate overhead? — Treadstone Academy

Can an 'exclusive remedy' clause in a purchase agreement block a buyer from seeking rescission for misrepresentation? — Treadstone Academy

Can an executor be personally liable for a deceased business owner's unpaid taxes? — Treadstone Academy

Can a buyer set off an indemnity claim against payments still owed under a vendor take-back note? — Treadstone Academy

Can a most-favoured-nation clause in a customer contract blow up pricing after an acquisition? — Treadstone Academy

Can BDC replace my bank as the senior lender on a business acquisition? — Treadstone Academy

Can changing an inventory costing method in the year of a sale distort reported earnings? — Treadstone Academy

Can two companies negotiating a deal agree not to hire each other’s employees, or to hold pay steady between them? — Treadstone Academy

Can competitors share pricing or customer information during merger due diligence without breaking the Competition Act? — Treadstone Academy

Can CRA recharacterize a pre-sale reorganization under GAAR even if every individual step was legally valid? — Treadstone Academy

Can employees hold shares through a trust instead of stock options, and does the same tax rule apply? — Treadstone Academy

Can I change an employee’s pay, title or duties after buying a business instead of terminating them outright? — Treadstone Academy

Can I sell business assets to a company I'm affiliated with and still claim a terminal loss? — Treadstone Academy

Can I waive a union’s successor rights in a Quebec asset purchase agreement? — Treadstone Academy

Can insurance proceeds or tax savings reduce what a seller owes under an indemnity? — Treadstone Academy

Can majority shareholders force out a holdout shareholder without going to court? — Treadstone Academy

Can my new acquisition entity be treated as one employer with my other companies for an unpaid wage claim? — Treadstone Academy

Can the government impose conditions on a business while an Investment Canada Act national security review is still underway? — Treadstone Academy

Can the Competition Bureau compel a customer or supplier who isn't part of a deal to produce records? — Treadstone Academy

Can the Competition Bureau restart the merger-review clock with a supplementary information request? — Treadstone Academy

Can the CRA collect a company's tax debt directly from its customers? — Treadstone Academy

Can you claim the capital gains exemption on shares held through a holding company? — Treadstone Academy

Can you close a deal before the Competition Act waiting period ends? — Treadstone Academy

Can you crystallize the capital gains exemption on the same shares twice? — Treadstone Academy

Can you sell a brand name that was never registered as a trademark? — Treadstone Academy

Can you transfer a family farm to your child without triggering tax? — Treadstone Academy

How do I discharge a PPSA registration when the registrant never actually took security? — Treadstone Academy

Do BC and Alberta commercial landlords have to be reasonable when refusing to consent to a lease assignment? — Treadstone Academy

Do I need to check a target’s significant control register before a lender will fund the deal? — Treadstone Academy

Do the CSBFP’s loan sub-limits stack, or is $1,000,000 the real maximum for buying a business? — Treadstone Academy

Do I need a clearance certificate when buying a business from a non-resident seller? — Treadstone Academy

Do I need to be GST/HST-registered before I can claim input tax credits on start-up purchases? — Treadstone Academy

Do non-voting shareholders get a vote when a corporation continues into another jurisdiction? — Treadstone Academy

Do shares gifted to my adult child stay protected if their marriage later breaks down? — Treadstone Academy

Does a corporate board have to accept the highest offer for the company? — Treadstone Academy

Does a business sale ever need federal approval, even when it's far below every dollar threshold? — Treadstone Academy

Does a buyer in Quebec inherit liability for the seller’s unpaid wages, even with an indemnity in the purchase agreement? — Treadstone Academy

Does a cannabis retail authorization transfer with the store? — Treadstone Academy

Does a collective agreement automatically transfer when I buy a unionized business in Ontario? — Treadstone Academy

Does a commercial lease transfer automatically when you buy a business’s assets? — Treadstone Academy

Does a court-approved insolvency sale wipe out existing claims against the business? — Treadstone Academy

Does a group termination in Quebec or under the Canada Labour Code involve more than just extra notice? — Treadstone Academy

Does a contractual holdback have to be set aside in a separate account, or can the buyer just promise to pay it later? — Treadstone Academy

Does a liquor licence transfer when you buy a bar or restaurant? — Treadstone Academy

Does adding a new business partner or director trigger an Ontario liquor licence transfer? — Treadstone Academy

Does a newly acquired subsidiary automatically join the parent's GST/HST group election? — Treadstone Academy

Does a 'no undisclosed liabilities' representation cover a contingent liability like a guarantee, or only liabilities already on the balance sheet? — Treadstone Academy

Does a pharmacy’s accreditation certificate transfer to a buyer? — Treadstone Academy

Does a corporation have to be solvent to use a plan of arrangement? — Treadstone Academy

Does a price adjustment clause protect a freeze if CRA later revalues it? — Treadstone Academy

Can a purchase agreement transfer a business asset that legally requires a third party’s approval — a lease, a licence or a quota? — Treadstone Academy

Does a Quebec landlord have to respond to a lease-assignment request within a set time? — Treadstone Academy

Does filing a record of site condition protect an Ontario buyer from environmental cleanup orders? — Treadstone Academy

Does a seller’s right to buy back shares on default count as “control” under the Income Tax Act? — Treadstone Academy

Does a share purchase avoid transferring a business’s licences? — Treadstone Academy

Does a signed release protect a federally regulated employer from an unjust-dismissal complaint after paying notice and severance in full? — Treadstone Academy

Does a spouse’s guarantee on a business-acquisition loan need independent legal advice? — Treadstone Academy

Does a state-owned enterprise face a different Investment Canada Act threshold than a private buyer? — Treadstone Academy

If I place employees on temporary layoff instead of terminating them after closing, could that turn into a termination anyway? — Treadstone Academy

Does a bankruptcy trustee need special permission to keep a regulated business like a pharmacy open while selling it? — Treadstone Academy

Does a vendor take-back note need to state an annual interest rate? — Treadstone Academy

Does an asset buyer inherit the seller’s environmental cleanup liability in Ontario? — Treadstone Academy

Does an employee’s length of service automatically carry over when a business is sold? — Treadstone Academy

Does an estate freeze always need a section 85 or section 86 election? — Treadstone Academy

Does buying into a partnership trigger Competition Act notification the same way buying shares does? — Treadstone Academy

Does buying the shares of a company instead of its assets avoid the need for landlord consent to the lease? — Treadstone Academy

Does deferred revenue assumed in an asset purchase need its own tax election? — Treadstone Academy

If I lose a federally regulated services contract on retender, does the incoming contractor inherit my former employees’ service — with no sale at all? — Treadstone Academy

Does moving investments out of a company before a sale protect the capital gains exemption? — Treadstone Academy

Does owning less than 50% of the shares in a regulated business mean an investor doesn't control it? — Treadstone Academy

Does rebranding an acquired business risk its trademark? — Treadstone Academy

Does buying representations and warranties insurance eliminate the seller's indemnity obligations? — Treadstone Academy

Does the ITA section 22 election on accounts receivable apply to a share purchase? — Treadstone Academy

Does section 84.1 apply if the seller is a non-resident of Canada? — Treadstone Academy

Does the 21-year trust rule still apply if a beneficiary has moved outside Canada? — Treadstone Academy

Does the capital gains exemption eliminate alternative minimum tax on a sale? — Treadstone Academy

Does the Canada Small Business Financing Program require an independent appraisal? — Treadstone Academy

If a company redeems a deceased partner's shares using life insurance, does the survivor get a higher cost base? — Treadstone Academy

Does thin capitalization limit interest deductions when a foreign parent funds a Canadian acquisition with a shareholder loan? — Treadstone Academy

Does a seller's unremitted GST/HST or payroll deductions survive its bankruptcy ahead of a secured lender? — Treadstone Academy

If a seller updates the disclosure schedule between signing and closing, does that cure the buyer's indemnity claim too, or just the closing condition? — Treadstone Academy

Does a working-capital adjustment capture a take-or-pay purchase commitment? — Treadstone Academy

How do I know if my employees are governed by the Canada Labour Code instead of provincial employment law? — Treadstone Academy

How do you avoid double tax when an estate inherits a company full of retained cash? — Treadstone Academy

How does the Investment Canada Act define “control” of a business? — Treadstone Academy

How far back can the CRA reassess a company after I buy it? — Treadstone Academy

How is dismissing an employee in Quebec different from Ontario? — Treadstone Academy

How is an owner’s salary normalized when valuing a business, and can the CRA challenge it separately? — Treadstone Academy

How is severance pay calculated in Ontario, and what commonly gets miscalculated? — Treadstone Academy

How is unbilled work in progress treated when selling a professional practice? — Treadstone Academy

How long can a receiver keep operating a liquor-licensed restaurant or bar while selling it? — Treadstone Academy

How long after closing can a trustee attack a business sale as a transfer at undervalue? — Treadstone Academy

How long can I spread the capital gain when I sell my business to an employee ownership trust? — Treadstone Academy

How long can there be a gap before Ontario treats a sold business’s employees as having a break in service? — Treadstone Academy

How long can you spread a capital gain when selling directly to your child? — Treadstone Academy

How long do representations and warranties survive after closing, and can the parties shorten Ontario's normal limitation period? — Treadstone Academy

How many directors of a federally incorporated (CBCA) company must be Canadian residents? — Treadstone Academy

How many employees do I have to lay off before mass or group termination notice rules apply, and is the number the same across Canada? — Treadstone Academy

If a receiver was never hit with an environmental order, does that mean the site I’m buying is clean? — Treadstone Academy

If I win a cleaning or security services contract, do I inherit liability for the outgoing contractor’s employees I don’t hire? — Treadstone Academy

Is a book allowance for doubtful accounts the same as a tax-deductible bad debt reserve? — Treadstone Academy

Is a construction statutory holdback part of a target’s working capital? — Treadstone Academy

Is a CVOR certificate transferable on a trucking company sale? — Treadstone Academy

Is a minority shareholder's stake valued as a straight fraction of the whole company, or at a discount? — Treadstone Academy

Is a three-year retention bonus for management taxed only when it’s actually paid? — Treadstone Academy

Is a non-compete enforceable if the person who signed it was never paid anything for it? — Treadstone Academy

Is a non-compete on the sale of a business illegal under Canada's Competition Act? — Treadstone Academy

Is a buyer of shares bound by a unanimous shareholders agreement it was never shown? — Treadstone Academy

Is a signed letter of intent legally binding on a business sale? — Treadstone Academy

Is a temp staffing agency’s licence transferable on a sale, and is the client liable if the agency doesn’t pay its workers? — Treadstone Academy

Is buying a foreign company that owns a Canadian subsidiary reviewable under the Investment Canada Act? — Treadstone Academy

Is cash you take back on a section 85 rollover tax-free? — Treadstone Academy

Is Ontario land transfer tax payable on a long-term commercial lease? — Treadstone Academy

Is Ontario land transfer tax payable when a business is bought by purchasing shares instead of assets? — Treadstone Academy

Is money received under an earn-out taxed as a capital gain or as ordinary income? — Treadstone Academy

If a buyer closes knowing a representation is false, can it still claim indemnification (is 'sandbagging' allowed)? — Treadstone Academy

If I sell my whole business for one price, is the part allocated to inventory still taxed as income? — Treadstone Academy

Is there a payroll size below which a federally regulated employer owes no severance pay? — Treadstone Academy

Is there a maximum legal interest rate on acquisition or bridge financing in Canada? — Treadstone Academy

What's the difference between an oppression remedy and a derivative action under the CBCA? — Treadstone Academy

How long does a lender have to re-register PPSA security after collateral is transferred to a buyer? — Treadstone Academy

Should a tax reassessment be covered by the deal's indemnity cap, or carved out as a fundamental representation? — Treadstone Academy

Should below-market related-party rent be adjusted when calculating a business’s EBITDA? — Treadstone Academy

What are the tax consequences of forgiving part of a vendor take-back note? — Treadstone Academy

What can disqualify shares from the lifetime capital gains exemption even if the business itself qualifies? — Treadstone Academy

What counts as 'reasonable detail' in a notice of an indemnity claim, and what happens if the notice falls short? — Treadstone Academy

What does a quality-of-earnings review actually check for in a business sale? — Treadstone Academy

What does 'to the seller's knowledge' mean in a representation if the agreement never defines whose knowledge counts? — Treadstone Academy

What happens if someone signs a bring-down certificate at closing knowing a representation is no longer true? — Treadstone Academy

What happens if an estate freeze undervalues the founder's shares? — Treadstone Academy

What happens if the CRA disagrees with the value used to transfer shares to a family member? — Treadstone Academy

What happens to a company's shares for tax purposes when the owner dies without a succession plan? — Treadstone Academy

What happens to a commercial lease if the tenant corporation is dissolved before a sale closes? — Treadstone Academy

What happens to a pharmacy licence if the owner dies? — Treadstone Academy

What happens to an employee on leave when the business they work for is sold or restructured? — Treadstone Academy

What happens to an indemnity claim if the seller dissolves the company before the survival period runs out? — Treadstone Academy

What happens when a closing statement clause says “ASPE, consistent with past practice” and past practice was not ASPE-compliant? — Treadstone Academy

What is a graduated rate estate, and why does its 36-month window matter? — Treadstone Academy

What is a locked-box ticker, and how much can it charge for the interim period before closing? — Treadstone Academy

What is a materiality scrape, and what's the difference between a single scrape and a double scrape? — Treadstone Academy

What is a movable hypothec in Quebec, and how is it different from a PPSA security interest? — Treadstone Academy

What is an indemnity basket, and can some claims sit entirely outside the basket and cap? — Treadstone Academy

What is the 21-year rule for a family trust, and why does it matter before a business sale? — Treadstone Academy

What's the difference between 'several' liability and 'joint and several' liability among multiple sellers? — Treadstone Academy

What is the Investment Canada Act review threshold for a foreign buyer? — Treadstone Academy

What is the ITA section 22 election on accounts receivable, and when must it be filed? — Treadstone Academy

What triggers a Competition Act pre-merger notification? — Treadstone Academy

What’s the difference between a fraudulent preference and a transfer at undervalue? — Treadstone Academy

What's the difference between an arbitration clause and an expert-determination clause in a purchase agreement, and can either be avoided by suing in court? — Treadstone Academy

What’s the difference between buying a business from a court-appointed receiver and buying it in a proposal sale? — Treadstone Academy

In a short-form amalgamation of two subsidiaries, which company survives? — Treadstone Academy

Is the buyer responsible for withholding tax when employee stock options are cashed out on a sale? — Treadstone Academy

Who withholds tax when a non-resident shareholder sells their shares -- the buyer or the seller? — Treadstone Academy

Why can't you just sell your shares to your own holding company and pay ordinary capital gains tax? — Treadstone Academy

Why can the same business show two different EBITDA numbers depending on the accounting framework? — Treadstone Academy

Why would an estate freeze create a taxable benefit for the founder every single year? — Treadstone Academy

The Canadian benchmark

What do businesses like this one actually sell for?

Canadian small-business transaction data is not published anywhere, so most valuations in this country quote an American benchmark. The Deavo–Treadstone Acquisition Index is a daily record of Canadian listings built to replace that: asking-price distributions by province and city are published now, and days on market, departure rates and asking-to-sale spreads follow as the series lengthens. Leave an email and we will tell you as each measure lands.

No pitch, no listings. One email as each measure is published.