Asset vs. Share Purchase

What are the differences between both from a tax perspective? I'm curious to hear what would be more attractive in terms of tax efficiency for both the acquirer and the seller?

4 Comments
 

Thanks fryguy22... Very useful information. I'm trying to understand if the favorable taxes of an asset purchase (due to step up of tax base and future benefits from higher depreciation) outweigh the pain of getting waivers from the sellers existing creditors (due to the Bulk Sales Law)... Also, I've heard that with an Asset purchase, you would have to fire and rehire (if that is your intention) the employees managing those assets. Is there a strategic way around this? I feel like a share purchase would eliminate this burden.

 

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