Asset Transfer Agreement (Land for Shares) | Canada

Use this Section 85 rollover agreement to transfer real property to a corporation in exchange for shares while avoiding capital gains tax.

• A rollover allows you to transfer the asset under Section 85 of the Income Tax Act (Canada) without attracting capital gains tax on the transaction.
• In exchange for the land, the corporation purchasing the land issues shares to the vendor in an amount equal to the fair market value of the land.
• The purchaser and vendor agree to jointly file an election under subsection 85(1) of the Income Tax Act.
• A section 85 rollover agreement gives you a means to preserve your assets and reduce your tax liability.
• This document is governed by Canadian tax laws and is intended for use in Canada only.

Prepare a Section 85 Rollover Agreement for a share exchange between a corporation and a shareholder with this template form, pursuant to s. 85 of the Income Tax Act (Canada).

• The shareholder sells common shares it holds in the capital stock of the corporation back to the corporation in exchange for new preferred shares, to be issued from Treasury.
• The parties agree to file a joint election for fair market value of the old common shares.
• The purchase price is adjusted to ensure that the redemption amount for the new shares does not exceed any reassessment of the fair market value of the old shares, or vice versa.
• This document package contains:
  • a template Share Purchase Agreement, and
  • a set of corporate resolutions of the directors and shareholders approving and authorizing the rollover.
• The rollover forms package is provided in MS Word format and is fully editable to fit your specific circumstances.
• This legal document is compliant with Canadian tax laws and is intended for use only in Canada.

Use this easy package of downloadable forms to facilitate a Section 86 asset rollover as part of a corporate reorganization of a Canadian company.

This package contains the following documents in Microsoft Word format:

1. Share Exchange Agreement pursuant to Section 86 of the Income Tax Act (Canada).
2. Form of Subscription for the new shares being issued in exchange for the existing shares.
3. Corporate resolutions to authorize the transaction.
4. Schedule to Articles of Amendment setting out the terms and conditions to be attached to the classes of shares.

This Section 86 Rollover Agreement for Shares is pursuant to Canadian tax laws and is intended for use solely within Canada.

Transfer depreciable property as part of the sale of a business in Canada with this Property Transfer Agreement.

• The parties agree that the property is being transferred at fair market value.
• The purchaser agrees to issue shares in its capital stock to the seller and assume any outstanding encumbrances on the property as payment of the purchase price.
• The parties agree to make a joint Section 85(1) election under the Income Tax Act (Canada).
• The parties mutually indemnify each other with respect to the transfer.
• The agreement sets out the manner of arriving at an agreed amount for depreciable property subject to subsection 85(5.1) of the Act, and eligible capital property subject to subsection 248(1).
• The parties intend that the purchase price for the assets be an amount equal to the fair market value of the assets at the date of the agreement.
• This template is available in MS Word format, and is fully editable to fit your circumstances.
• This legal document is governed by Canadian tax laws.

Secure the balance payable to the vendor under an asset purchase or rollover agreement with this Promissory Note form for Canadian businesses.

• No interest will accrue on the principal balance prior to default or maturity.
• The full amount outstanding will become due and payable on demand if the purchaser declares bankruptcy, ceases to do business, or otherwise defaults under the terms of the Note.
• The balance may be totally or partially prepaid without bonus or penalty.
• Available in MS Word format.
• Intended to be used only in Canada.