ARTICLE · 31 MAY 2023

The "GIST" Of Genuine Intergenerational Share Transfers: Important Proposed Legislative Changes

Cox & Palmer

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Business owners planning to transition their business to the next generation will need to consider further changes proposed to the rules for intergenerational business transfers in the 2023 Federal Budget.

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Business owners planning to transition their business to the next generation will need to consider further changes proposed to the rules for intergenerational business transfers in the 2023 Federal Budget. These changes were expected and much anticipated following the enactment of Bill C-208, a private member's bill that received Royal Assent on June 29, 2021 and became law as of that date.¹ Bill C-208 amended the Income Tax Act (Canada) (the "Act") with the main aim of creating fairness in Canada's tax system by placing genuine intergenerational share transfers on equal footing with arm's length share sales. This was welcome news to many business owners who intended to cede their business to their children or grandchildren.

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