When should this checklist be run?

The moment a transaction is realistically contemplated — ideally 24+ months out, because the LCGE holding test and purification cannot be fixed retroactively.

What is the GAAR risk in a normal sale?

Usually low for straightforward sales; it rises with aggressive sequencing (surplus strips, value shifts). The modern GAAR carries a penalty, which is why a written opinion on anything creative is now standard.

Do these apply to a family transfer too?

More so — s.84.1 is specifically about family purchases, and the intergenerational relief pathways have their own conditions and timelines.

Transaction-Year Checklist

Eight regimes fire simultaneously in a sale year — regular tax, AMT, LCGE, s.84.1, RCA, CDA, GAAR, mandatory disclosure. Confirm every one.

★ CHAPTER BRIEF

A sale or major reorganization year is the one year the tax regimes stack: regular tax, AMT, the LCGE tests, s.84.1 on family deals, RCA opportunities, CDA elections, the modernized GAAR, and mandatory-disclosure filings — all live at once. The book’s answer is unglamorous: a checklist, confirmed in writing, before closing.

Every item here is a regime that has surprised real owners in real transactions — an AMT bill nobody modelled, an LCGE lost in diligence, a family purchase recharacterized as a dividend. Work through the eight with your team; each unconfirmed item names the professional who owns it.

This is also the page where the Success Squad earns its keep: no single advisor covers all eight regimes. The checklist is the coordination artifact — bring it to the first transaction-planning meeting.

★ KEY POINT

“Strategy without execution is theatre.” In a transaction year, execution is literally a checklist — the cost of confirming each regime is a meeting; the cost of missing one is measured in six figures.

⚠ WARNING

Mandatory-disclosure rules now attach penalties and extended reassessment windows to missed filings on reportable transactions. This is new machinery since many advisors formed their habits — ask the question explicitly.

Regular tax. Has the regular tax on the sale been modelled at actual (not assumed) allocations?Share vs asset allocation swings the bill by six figures before any planning starts.AMT. Has Alternative Minimum Tax been computed for the claim year?An LCGE year is a classic AMT trigger — recoverable within about seven years, but only if planned for.LCGE. Do the shares pass all QSBC tests today, and will they for the final 24 months?Purification after the letter of intent is usually too late.s.84.1. If family is buying: does the deal meet the immediate (~3-yr) or gradual (up to 10-yr) intergenerational tests?Failing s.84.1 converts your capital gain (and LCGE) into a deemed dividend at dividend rates.RCA. Has a retiring-allowance / RCA contribution been evaluated in the sale year?A sale year is peak income — the year an RCA deduction is worth the most.CDA. Will the CDA balance be verified and elected (T2054) before distributions?Tax-free capital dividends only exist if the election is filed on a verified balance.GAAR. Has the plan been reviewed against the general anti-avoidance rule as amended?Post-2023 GAAR carries a penalty; aggressive sequencing needs a written opinion.Mandatory disclosure. Do any steps trigger reportable- or notifiable-transaction filings?Missed disclosure deadlines carry penalties and extended reassessment windows.

Transaction-year readiness

0 / 8

8 of 8 regimes unconfirmed. In a transaction year these fire simultaneously — every gap below is a specific conversation before closing.

Regular tax — ask your CPA
AMT — ask your CPA
LCGE — ask your Tax counsel
s.84.1 — ask your Tax counsel
RCA — ask your Actuary
CDA — ask your CPA
GAAR — ask your Tax counsel
Mandatory disclosure — ask your Tax counsel

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Questions to ask your advisor

Ask your Tax counsel

Which of the eight regimes apply to this specific transaction, and who signs off on each?

Ask your CPA

Model regular tax AND AMT for the closing year — what does the recovery plan for AMT look like?

Ask your Actuary

Is a sale-year RCA or retiring allowance worth pricing while income is at its peak?

Continue in book order

From Chapter 4QSBC / LCGE Risk & Purification Planner From Chapter 16Estate Freeze Estimator From Chapter 17Success Squad Mapper

Educational illustration, not advice. This tool is provided for educational purposes only and does not constitute financial, tax, legal, accounting, or insurance advice. Results are estimates, not promises — hypothetical illustrations are projections only. Figures use Ontario rates as of the date stamped above; rates and limits change. Confirm current figures and your specific situation with a CPA, tax lawyer, and licensed insurance advisor before acting.