Transfer boat from Personal to corporate ownership

[Captain PartyMarty]

Hi all

I have a tax related question I am hoping one of you might have an answer to. I started a corporation to split my charter business activities out of my personal finances and now am looking to transfer ownership of my boat to the corp. I found this tax bulletin Bulletin PST 210 which shows I would be exempt from the PST under this section Exemption for Transfers of Assets to a New Corporation – Wholly Owned and Controlled. I am pretty confident that I will not need to pay the PST on the transfer of assets.

The question now is what happens with the GST? I have a sole proprietorship and a corporation, which are both registered for GST numbers. If the sole proprietorship sold the boat to the corporation would the GST just be a wash? Sole Proprietorship collects the GST and the corp just claims it back?

Anyway I hate tax **** why do they need to make things so complicated......

CPM

 

[Cookie's Cutter]

Gst would be a wash, but If you use the boat for any personal use you are required to charge yourself a reasonable fee for it.

 

[ab1752]

I would pay for an opinion here from your accountant. It could be a deemed disposition and the corporation would be liable to taxes based on fmv. Also, check with your insurance provider as the liabilities may pivot when the title to the vessel changes from personal to corporate.

I found cra has a dim view on using boat expenses for business purposes. Mine is simply take a few "clients" out and expense some fuel. Yours is a different scenario for sure.

 

[Gong Show]

I'm not an accountant and do not give tax advice, but look at a section 85 rollover.

 

[brutus]

Get a good accountant ( good with CRA laws ) and listen to him, not some random dudes on SFBC lol. CRA don’t f… around when they want their share

 

[Bill 310]

It is important that you get good accounting advice on this matter. Accountants are not all the same when it comes to their compentencies and while your situation looks like a simple transaction you don't want your situation to be the first one an accountant sees, and you don't want to have the documentation provided to CRA to be out of sorts and/or raise red flags..

For years we used a small accounting firm for our company. The work we needed done annually was pretty standard.

When we received an offer to buy our company our tax lawyers told us we needed to change accounting firms because the work we needed was outside of our current accountants area of expertise.

 

[brutus]

It is important that you get good accounting advice on this matter. Accountants are not all the same when it comes to their compentencies and while your situation looks like a simple transaction you don't want your situation to be the first one an accountant sees, and you don't want to have the documentation provided to CRA to be out of sorts and/or raise red flags..

For years we used a small accounting firm for our company. The work we needed done annually was pretty standard.

When we received an offer to buy our company our tax lawyers told us we needed to change accounting firms because the work we needed was outside of our current accountants area of expertise.

This exactly what I mean, payroll account and book keeping is one thing, knowing CRA laws is another, had to deal with audit from CRA over the years and glad I have a good accountant

 

[Captain PartyMarty]

Thanks guy’s for the input. I am confident in the accounting service I have. I just like to do my own research so I know what they are talking about when I bring up the questions to them.