| | | April 2020 | Business investment losses
Richard MacDonald, CPA, CA, CPA (Illinois), is a tax partner at Baker Tilly WM
Anu Dogra, CPA, CA, is a tax director at Baker Tilly WM | In today's business and social environment, more and more owner-managers are struggling to keep their businesses alive. Many find it necessary to inject capital, including personal funds, into their companies. These funds might come from mortgaging their home, drawing on personal credit lines, or even friends and family. But investing in a business when there is an increased risk of struggle or failure requires that any investment should be planned with potential future loss in mind. Where such investments are made to private corporations, the investors or owner-managers may be entitled to a special type of loss known as a business investment loss (BIL). A BIL is a type of capital loss with one important advantage.
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Baker Tilly Canada periodically publishes Tax Alert for its clients and associates. It is designed to highlight and summarize the continually changing tax and business scene across Canada. While Tax Alert may suggest general planning ideas, we recommend professional advice always be sought before taking specific planning steps. |
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