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Join Ian MacDonald and Kim Drever from MNP as they walk you through the Federal Budget Changes.

Budget 2024 proposes to increase the capital gains inclusion rate for capital gains realized on or after June 25, 2024.

Based on the announcements, corporations and trusts would experience a capital gain inclusion rate increase from one half to two thirds on all gains after that date, while individuals would continue to enjoy a one half inclusion rate for the first $250,000 of capital gains in a year, and be subject to an inclusion rate of two thirds on all capital gains in excess of that amount.

With the changes in the capital gain inclusion rates, the stock options will also experience a corresponding increase in the amount of the stock option benefit that will be subject to tax. This will mean that organizations will want to review their Employee Share Ownership and/or Option plans.

In addition, the lifetime capital gain exemption is announced to increase to $1,250,000 for dispositions on or after June 25, 2024.

The Budget also included a new Entrepreneur Incentive that would provided a reduction in the inclusion rate in certain circumstances.

With each situation being unique, planning should be considered with respect to whether or not realizing a capital gain prior to the June 25, 2024 deadline is warranted. Various alternatives exist to crystallize gains prior that date, even without a third party sale.

Ian MacDonald CPA, CA
Partner, Real Estate and Construction, MNP

Ian is a Partner with MNP’s Assurance and Accounting Services group in Edmonton and leads the Edmonton Region’s Real Estate and Construction team. A trusted advisor, Ian works one-on-one with clients primarily in the real estate and construction industry, including land developers, commercial real estate owners and developers, property managers, commercial and residential brokerages, general contractors, and subcontractors, helping his clients achieve their business goals through ensuring their accounting, tax and structure are aligned for success.

With nearly two decades of experience, Ian guides his clients’ strategic decisions, including on overall structures, succession planning, and tax minimization. He also delivers customized assurance and accounting services, personal and corporate tax planning, financial forecasting, governance advice, as well as strategy and business advisory services to help enterprises proactively manage their operations.

J. Kim Drever FCPA, FCA
Specialty Tax Partner

Kim Drever is a Partner and the Regional Leader of MNP’s Tax Services group for the Edmonton region. Kim specializes in Canadian corporate reorganization and tax planning for businesses and their stakeholders. Kim currently serves on MNP’s Board of Directors and MNP’s Tax Executive Committee.

Working one-on-one with her clients, Kim delivers innovative tax, structure and reorganization solutions tailored to clients’ specific needs. She plans appropriate business structures while preserving wealth and ensuring that business owner needs are taken care of. In addition to internal reorganization and succession planning, Kim helps with planning and structuring the tax implications of business purchases and sales.