Federal budget 2013 - The impact on Canadian private companies

Unfortunately for entrepreneurs, the 2013 federal budget continued the trend of recent budgets—shutting down perceived tax advantages for private business owners, while offering little if any new opportunities.

The latest planning tools that the Department of Finance has targeted relate to products offered by the life insurance industry, principally to private business owners and high net worth individuals.

Any individuals who have invested in a leveraged insurance solution commonly referred to as a 10/8 policy or more recently a 9/7 policy should consult with their insurance and tax advisors about the impact of the budget on their insurance planning.

Also, anyone who has invested in an insured life annuity arrangement involving borrowings should seek professional advice on the implications of the budget.

Finally, as bad news usually comes in threes, the budget also proposes to raise the federal tax rate on ineligible dividends by almost 2% commencing in 2014. The increase is even higher after taking into account provincial and territorial taxes.

On the plus side, the budget didn't raise any other taxes and increased the lifetime capital gains exemption from $750,000 to $800,000 starting 2014, with indexation of the amount after 2014.

For more information, contact:

Jason Safar
Canadian Private Company Services Tax Leader
jason.safar@ca.pwc.com

Growing your business: A webinar series for leaders of private companies

With more private companies focused on growing in an increasingly complex global economy, we have created a five-part series of short webinars for leaders of private companies. Each session will focus on a key area that supports your growth strategy and can help you build enterprise value.

We’ll share what we see the most successful private companies doing, challenge you with some thought-provoking questions, and leave time for an open discussion to answer your specific questions. Beyond the webinar series, we will always be happy to continue the conversation with you.

We invite you to register for the whole series, or just the sessions that are most relevant for your business, by clicking here.  

Wealth and tax matters for individuals and private companies

2011, Issue 2

 

Hot off the press, the latest edition of Wealth and tax matters, a periodic publication written by PwC's team of high net worth advisors, is now available. The easy-to-read publication has developed a loyal following of high net worth individuals, business owners, bankers and tax practitioners looking for ways to preserve wealth and minimize tax liabilities.

 

Features in this edition include:

• family matters, such as the basics of will planning and issues that arise during business succession
• new initiatives proposed by the Canada Revenue Agency with respect to high net worth individuals
• changes to the "kiddie tax" regime
• tax traps involving shareholders' agreements
• cross-border tax matters, such as owning a US rental property and considerations for individuals departing Canada

To read the latest edition of Wealth and Tax Matters, click here. To subscribe to receive the publication regularly, or to view previous issues, visit www.pwc.com/ca/wtm.

 

Introducing the Business Insights Survey of Canadian Private Companies 2011

Embracing the new

How have private companies fared through the volatile business landscape of the past year? What are they doing to position themselves for growth in the long-term? At a time when uncertain economic indicators are keeping everyone guessing on a daily basis, the seventh annual Business Insights Survey of Canadian Private Companies provides valuable insights for the private company community.

Wonder what it is like to work with PwC?

Archie Campbell is the former Senior VP & Chief Operating Officer of Golden Boy Foods Ltd., a private company and one of North America’s largest manufacturers of private label peanut butter, baking nuts, snacking nuts and dried fruit. He provides an inside view of what it is like to work with PwC and why he takes PwC wherever he goes.

Is CSR on the radar for private companies?

Results from the latest PwC Pulse Survey found that social responsibility and sustainability are low priorities for Canadian private companies.

• 21% of respondents currently have a corporate social responsibility (CSR) plan aligned to their business goals
• 53% of respondents view a CSR plan as a “nice-to-have”
• None of the private companies that have CSR plans are communicating them through recruitment initiatives


Insights into corporate social responsibility and sustainability provides a summary of the key findings from the latest PwC Pulse Survey and offers advice from Mel Wilson on what private company owners can do to stay ahead of the curve and position themselves for future success.

Also check out our Let’s Talk article, A business case for sustainability, as well as an As I see it piece, Responsible for success, that dive deeper into the issues discussed in the Pulse Survey report and demonstrate how CSR and sustainability can be integrated into your business plan. 

PwC Private Company Services Pulse Survey

We are taking a "pulse" of Canadian private companies to find out if sustainability and Corporate Social Responsibility (CSR) are on their radars.

Sustainability and CSR have become key elements of the business strategy for many organizations. In a resource constrained world, sustainability is increasingly important to managing cost and reputation risk, supply chain integrity, and ensuring compliance with laws and regulations. Sustainability has also presented new business opportunities as we see entrepreneurs emerge in the fields of green energy and carbon reduction. Many public companies report on their sustainability and CSR activities in their annual reports and sustainability reports. What are private companies doing? What is motivating them to take action?

This survey is now closed. We will share survey results with participants and post the findings to PwC's Private Company Services website in the coming weeks. 

What does it mean for private companies?

2011 Federal Budget

Yesterday's federal budget did not contain many changes for private business owners. The scheduled corporate tax rate reductions will continue and personal tax rates remain unchanged. There were a couple of positive announcements and several new measures to shut down tax loop holes or planning strategies.

Below we have highlighted some of the changes that we think will be of most interest to you. The PwC 2011 Federal Budget web page provides a more in-depth discussion of the budget. 

Focused on family businesses

We've launched the Canadian supplement to the 2010/11 PwC Global Family Business Survey, Making the next move.

Find out what family businesses have to say about their major concerns, the environment in which they operate and the unique factors that affect their business.

Click here to read more...

Embracing the Power of the Cloud

A fundamental shift is taking place around how to deliver technology solutions to support business.

In our recent Let’s Talk article, Philip Grosch, partner and National Technology Consulting Leader at PwC discusses how the arrival of software, infrastructure and platform as a service has influenced the competitive landscape for private companies, allowing them to effectively compete like never before.

Click here to read more.