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The Small Business Capital Gains Exemption

Published in Taxes Be the first to comment on this article ►

Finances Coins

In the many conversations I have regularly with owners of privately owned businesses, I am constantly surprised that they are virtually unaware of the tax benefits when they are thinking of a succession plan or selling the Shares of their company. In the 2007 federal budget, the lifetime capital gains exemption was hiked 50% to $750,000, which means that the first $750,000 of the sale price of each shareholders company “Shares” will have a capital gain that exempt from all income taxes. Under our Canadian tax laws, taxpayers bring only 50% of the remaining gain into play as income and pay taxes only at their individual marginal tax rate.

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