The Case of High Capital Taxes
The company had a large leasing fleet of heavy equipment, leased to major transportation companies. Because of the financing levels required, the client was paying very large amounts of provincial capital tax each year. The capital taxes were becoming so burdensome; they were impacting the viability of the leasing operation.
Scarrow Yurman & Co with the assistance of tax counsel, advised the client to transfer the leasing fleet to a Limited Partnership, and through the use of various tax elections and restructurings, set a tax strategy in place that almost entirely eliminated the capital taxes payable.
The client saved close to $500k in the first year on reduced capital taxes and these savings continued for many years.