What is the Income Tax Statutory Declaration?
Section 116 Statutory Declaration is a closing document that attests that the vendor is not a non-resident of Canada under the Income Tax Act at the time a business transfer takes place.
What happens if the seller does not sign a S.116 Statutory Declaration?
The purchaser will be required to hold back 25% of the purchase price and remit it to the CRA within 30 days following the end of the month in which the transaction occurred.
What is a clearance certificate?
A clearance certificate is provided by the CRA to the Vendor when the Vendor is no longer indebted to the CRA for any taxes.
