Is It Time to Close or Sell a Business In Canada- This Is What To Do

Is It Time to Close or Sell a Business In Canada- This Is What To Do

As an entrepreneur, you may decide to leave your business for different reasons. These may include the desire to pursue a new opportunity, a major life challenge, financial concerns or family obligations. Closing or selling your business can take a lot of time and planning. This means, the earlier you start the more likely you will be able to succeed and see a smooth transition. If you are planning to close your business in Canada, there are a number of things that you need to do such as informing the revenue agency, filing the tax forms, and paying any outstanding taxes.
close a business

The first thing is to have is a succession plan. This will help you transfer the management of the business to someone else. You can do this even if you are not leaving or selling the business right away. This plan should outline your vision and goals to change the business. You may also include things such as training the new manager and the roles and responsibilities that they will be doing in the business. Doing this can save you a lot of time in future and ensure that your business is in good hands.

If you are planning to close your business here are some of the key things that you need to do.

  • Fill a tax return if you are closing up.
  • Cancel your business registration.
  • Close your accounts with the appropriate provincial agency.
  • Close your GST/HST accounts.
  • Cancel your business registration.

Dissolving a corporation

Dissolving your business is basically the legal act that ends its existence. Irrespective of how the business is operating, when it’s time to close there are a lot of factors that you must take into consideration. This is almost the same thing that you usually do when forming a corporation. It’s important to fill forms with the respective government agencies.  Before doing this, confirm that you have all the legal authority to dissolve, fill the forms and distribute all the available liabilities and assets.

Selling the business

If you want to sell the business, you can sell the assets but you are not allowed to transfer the registration for the business. This means you must close the business so that the new owner may be able to register afresh. It’s upon you to pay any outstanding amounts that might be needed. When analyzing the market price, you may be forced to hire a professional evaluator or an accountant to assist you does this. A buyer might also assist, but it’s not advisable to use a buyer. However, before doing anything you need to ensure that all your books are up to date.

Finalizing the sale

When finalizing the sale of your business you need to sign a contract. It’s important to hire the services of a lawyer who will, therefore, review prepare the paperwork that needs to be signed before going ahead and selling your business. In case of any legal questions, contact a lawyer to assist you handles this. However, in case you are facing financial challenges do not declare bankruptcy when selling your business you first need to consider other options before doing this.

There you have it, how to close or sell a business in Canada.