Insights

The practice of law is changing every day, and the effect of changing legislation on businesses is significant. We write about recent developments in the world of tax & business law, keeping a watchful eye on the changing landscape for our clients. See what we’re thinking about, and what your business should be looking out for.

Tax Law

Rule Changes Target Personal Service Businesses

If you provide services through a corporation, or employ such persons, you should be aware that recent legislative changes have dramatically increased the tax risks of such arrangements. According to these legislative changes, the tax payable by Personal Services Businesses (PSB) has been significantly increased. In addition to losing the ability to deduct most business expenses, if a worker’s corporation is considered to be a PSB, then the corporate tax rate will increase from 14% to 38%. A PSB is defined in the Income Tax Act to include a business carried on by a corporation through which services are provided by an...

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Tax Law

IRS Extends Offshore Voluntary Disclosure

On January 9, 2012 the United States Internal Revenue Service (“IRS”) announced the indefinite extension of the 2011 Offshore Voluntary Disclosure Initiative (“OVDI”). Because Canada is the great neighbour to the north and home to many U.S. taxpayers, many residents here find themselves with unmet U.S. tax filing obligations.  The good news is that the extension of the 2011 OVDI may afford these individuals the opportunity to file delinquent U.S. returns pay reduced penalties. The OVDI has been touted by the IRS as a beneficial way for delinquent taxpayers to bring their filing obligations current and to save time, money...

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Business Law

Timing is Everything: Public Disclosure Obligations in M&A Transactions

Increased volatility in the financial markets and overall economic uncertainty continue to affect corporate planning and go-forward strategies. The drive to increase shareholder value may cause management to seek out and assess a broader range of enhancement and maximization alternatives. Current market conditions have created opportunities for both the hunter and hunted. Canadian reporting issuers (sometimes referred to as public companies) should be keenly aware of their continuous disclosure obligations as they proceed down the path towards a business combination, corporate sale or other strategic opportunity. Canadian securities legislation distinguishes between a ‘material fact’ and a ‘material change’. A material...

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