CRA s.85 & s.86 Business Valuations
Court-ready, CRA-defensible fair market value opinions for corporate reorganizations and tax planning.
Designed for accountants, tax lawyers and owner-managers who cannot afford to be wrong about FMV.
Fee Range: $1,500 - $15,000 · Basic Average: $3,500
Why FMV Matters So Much in s.85 and s.86 Transactions
Sections 85 and 86 of the Income Tax Act allow owners to reorganize or roll assets into a corporation on a tax-deferred basis. The catch is that the Canada Revenue Agency expects a supportable fair market value at the time of the transaction. If the value is challenged and found lacking, the tax cost can be severe.
Eric Jordan prepares valuations that explain how fair market value was determined, not just what the number is. This protects you, your advisors and your long-term plans.
Who This Service Is For
- Tax lawyers and accountants planning s.85 rollovers
- Owner-managers implementing freeze/shares or estate freezes
- Families transferring operating companies to the next generation
- Advisors concerned about CRA scrutiny of past or upcoming reorganizations
What Makes a Valuation “CRA-Defensible”
- Clear definition of fair market value consistent with CRA policy
- Transparent assumptions and support for key inputs
- Reconciliation of multiple valuation approaches where appropriate
- Integration of intangible assets and goodwill, not just hard assets
- Documentation that can withstand both CRA review and, if necessary, court challenge
Eric Jordan’s Approach
Each CRA-focused valuation combines the 25-Factor methodology with the specific requirements of the transaction:
- Identification of the assets and shares being transferred
- Analysis of historical and normalized earnings
- Assessment of risk, sustainability and growth prospects
- Explicit treatment of shareholder loans, related-party transactions and compensation
- Documentation suitable for inclusion in your working-paper file
Working with Your Professional Advisors
The best tax plans are collaborative. Eric routinely works with accountants and tax lawyers across Canada, ensuring that the valuation dovetails with your reorganization plan and supports your filing position.
Fees and Timelines
Most s.85 and s.86 valuations fall within the standard fee range of $1,500 to $15,000, with an average around $3,500, depending on complexity and urgency. Rush work is sometimes possible where deadlines require it.
Need a CRA-defensible valuation?
Contact 877 355 8004 or pindotca@gmail.com to discuss your transaction and timing.