Where Form 4797 Intangible 2022-2023

Instructions and Help about Where Form 4797 Intangible

In the 2023 federal budget the Liberals announced a new approach to how intangible assets are treated for tax purposes these new rules are effective January 1st 2023 intangible assets are eligible capital property includes amongst other things goodwill patents trademarks customer lists and franchise rates the tax rules will change for these assets so they are treated the same way as other depreciable assets but this is implications especially when it relates to the sale of eligible property currently gains from the sale of intangible assets can be taxed as business income with an inclusion rate of 50 percent so with the combined federal and Ontario corporate income tax rate of twenty six point five percent the effective tax rate drops to thirteen point two five percent but under the new rules any gain on the sale of intangibles will be treated as property income and tax will be payable at just over twenty five percent so if you have plans to sell intangible assets in the near future which includes goodwill on an asset sale of your business it is advantageous from a tax perspective to trigger the game this calendar year you should also speak to your tax advisor as it may be beneficial to trigger an internal gain on your intangible assets before December 31st 2016.