My client holds 100% shares of Holdco and the Holdco owns 100% of opco. He wants to close both corps but the holdco has 80K r/e and Opco has 90K deficit. If I do S88(1) wind-up, would the Holdco’s r/e be offset by Opco’s deficit on the financial statements?
On Opco’s f/s: No assets. Due to sh 90,000, Share capital 100, Deficit (90,100)
Yes. You’re moving the balance sheet up into the parent as if it were consolidated.
You seem to have a general understanding of this topic, so I won’t elaborate any further. GL.
Thank you. For transfers of rdtoh, cda, loss carryforward balances, I need to record only at the parent side?
Is this a discontinuation of the subsidiary and a wind-up within the same controlling group? Or any ownership changes at the top (i.e. acquisition of control)?
If no change in ownership structure, everything flows through, but subject to certain ownership provisions ofc (90% ownership rule, etc.). You want to indicate the balance transfers on the applicable T2 schedules of the parent. You are correct.
No acquisition of control. Thank you for your help. Really appreciate it
For the final return of the predecessor corps under S87 or Sub under S88(1), should the B/S items be left on the return to reflect what was transferred to the other corp or should all B/S items be reported as zero since this is a final return?
S87 - should be populated up to the date of amalgamation (which is the final return).
S88(1) - blank shell, everything moved into the parent. B/S is empty