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Winding up foreign held business Capital Gains or Foreign Income

Nov 19, 2019
1
0
Hello,

I am now a resident for canadian tax purposes. I was previously a resident in the UK for many years. I have a small business there with over $100k in profits in the ban . I am the director and sole shareholder. My understanding is that I can dissolve my UK company through a Members Voluntary Liquidation which allows for the profits to be taken as capital proceeds and taxable in the UK as capital gains. What does CRA need to be satisfied that this is capital gains and not some other form of income like dividends? If they were to treat it as income or foreign dividends instead of capital gains then I will be hit with a huge tax bill. If capital gains then CRA should not require any tax as the funds in the business account have not increased since I arrived in Canada and therefore treated as a deemed disposition. Any advice on how to square this away?
 

hatesurprises

Newbie
Aug 28, 2021
1
0
Hi confusedasallheck, did you resolve your matter? I am in a very similar situation and would be grateful to learn form your experience.