Purification for Lifetime Capital Gains Exemption

Canadian Tax Essentials: Personal & Corporate · 3:21

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Lyrics

[Verse 1]
Sarah's got a small business dream
Been building value through the years
But her corporation's not so clean
Mixed assets bringing tax fears
Active business income flows
But passive investments also grow
To claim the lifetime capital gains
She needs to purify the show

[Chorus]
Purify before you sell
Clean the corp and do it well
Twenty-four months is the rule
Active business is the tool
Purge the passive, keep what counts
Every dollar matters amounts
LCGE waiting at the end
Clean your house and cash transcends

[Verse 2]
Investment income's got to go
Rental properties must leave
Portfolio stocks can't steal the show
Active business you must achieve
Ninety percent of assets fair
Market value test with care
Look back two years from the sale
Clean books tell the winning tale

[Chorus]
Purify before you sell
Clean the corp and do it well
Twenty-four months is the rule
Active business is the tool
Purge the passive, keep what counts
Every dollar matters amounts
LCGE waiting at the end
Clean your house and cash transcends

[Bridge]
Timing is everything they say
Plan the purge the proper way
Dividends to clear the slate
Don't leave purification late
Asset sales and wind-up plans
Eight hundred thousand in your hands
Tax-free gains for qualified shares
Preparation always pays

[Verse 3]
Connected corporations too
Must meet the active business test
Fifty percent ownership through
The chain ensures you'll pass the rest
Small business corporation status
Required before the sale
Purification apparatus
Sets you up to never fail

[Chorus]
Purify before you sell
Clean the corp and do it well
Twenty-four months is the rule
Active business is the tool
Purge the passive, keep what counts
Every dollar matters amounts
LCGE waiting at the end
Clean your house and cash transcends

[Outro]
Twenty-four months back in time
Active business paradigm
Purify and organize
Claim your lifetime capital prize

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