Real ideas with real impact for your business and consulting solutions

Learn about some of the actual challenges faced by clients of Zeifmans, and how our team has been able to respond with practical business and consulting solutions that created a positive impact.

  • An investor strategically exits a losing business with his full investment intact

    Problem: We visited the radio station, and based on our assessment of the challenging political and economic environment, along with the high working capital requirements of the business, determined there was no value in the investment.

    Idea: We recommended the investor put up a further $1.6M required to participate in the Chilean buy/sell negotiation process. We were confident his partner would overvalue the business and end up owning it and paying our client an inflated value for his share, which we had valued at nil.

    Impact: We advised our client to bid $1 Chilean peso for the partner’s share, on the basis that if our client’s bid was less than his partner’s bid, our client would “lose”, and our client would receive the partner’s bid amount for his share. Any amount he would receive would be better than the nothing he would get if he walked away. The partner bid $8.1M Canadian for our client’s share, resulting in our client “losing” the bid and selling to his partner for $8.1M.

  • A couple selling family farm to fund retirement and saves on capital gains

    Problem: A couple owned a family farm close to Toronto, with a value of $2 million, wanted to sell the property to fund their retirement but were fearful of a hefty tax bill.

    Idea: Tax filings from the 1970’s and 1980’s allowed us to determine that the farm was eligible for capital gain exemption, even though it was not currently the primary source of income.

    Impact: Our client saved $475,000 in taxes allowing them to stay on track for their retirement plans.

  • Cross border tax saving strategy for a Canadian – US joint real estate venture

    Problem: Two entrepreneurs, 1 Canadian and 1 American, were leaving their comfort zone when they decided to jointly purchase a property.

    Idea: We worked with them to ensure they maximized their cash flows from the venture and ensured compliance and tax planning went seamlessly

    Impact: We determined a plan to cut Canadian taxes on this venture by over 50%, which allowed for increased cash flow and profits for our clients and their families.

  • Mitigated tax exposure strategy ensures savings and compliance for a US client

    Problem: A group of US citizens, and Canadian citizens with resident/citizen beneficiaries, run a Canadian real estate operation owned by a group of Canadian family trusts. When the media began reporting on the IRS obtaining information from Canadian banks and brokerages, the family became concerned that they may have been noncompliant or have filed incomplete US tax returns, which could result in significant penalties.

    Idea: We worked with the group to ensure compliance, while advising on the best methods to avoid capital dividends and penalties for Canadian residents. Review. We conducted an in-depth review of the corporate structure to unearth exposure to any potential issues such as grantor trust, foreign nongrantor trusts, Controlled Foreign Corporations (“CFCs”), and passive foreign investment companies. Investigate. Zeifmans investigated whether all US family members were compliant. In cases where noncompliance arose, we corrected any inadvertent errors that could lead to penalties. This included accessing the IRS “streamlined” compliance system to avoid penalties for Canadian residents. Confirm. In almost all cases, no tax was due. Any exposure was found to have been related to delinquent information filings regarding the interest in the trusts and corporation.

    Impact: The corporation’s indirect US owners and beneficiaries were able to avoid millions of dollars of US tax exposures without paying much tax, or any penalties. We provided our clients with a tax road map for the future, assisting them in identifying US tax traps and advising on correct compliance protocol for the coming years.

  • An international entrepreneur streamlines his tax planning to save $1M

    Problem: An international entrepreneur with substantial holdings in Canada was using different accounting firms for each of his businesses. As such, each accounting firm was making recommendations based on their own segment of his holdings, with no tax planning taking place for the group as a whole.

    Idea: Zeifmans developed a strategy that would produce synergy between the businesses through group tax planning, resulting in significant savings. Review. Zeifmans reviewed the client’s overall international and Canadian tax situation. Examining the filings of each of the firms involved, we assessed the efficacy of their strategies. Repair. After reviewing the strategies employed by all the accounting firms, we repaired our client’s personal tax status across a number of jurisdictions. We ensured that tax filings on a go-forward basis are coordinated and structured to minimize his overall tax burden. Align. Rather than continue a piecemeal strategy, Zeifmans assumed accounting and tax responsibilities for all entities that could be transferred without difficulty or impact on the business. This enabled us to begin an overall tax planning strategy for all the businesses as a group.

    Impact: As a result of our streamlining strategy, the client immediately found well over $1 million in tax savings on a pending transaction. His businesses continue to benefit from the complete line of sight, utilizing all available savings opportunities.

  • Estate Trustee During Litigation corrects decades-long fraud

    Problem: A prominent estate had been fraudulently depleted of millions of dollars by the formally appointed trustee.

    Idea: Zeifmans’ Estate Trustee During Litigation (EDTL) analyzed the web of corporate holdings and missing tax returns to forensically trace the transactions.

    Impact: A summary judgement was made in the amount of $3,733,455.20 and the original trustee was sentenced to jail time.

  • A global tax strategy for a high growth online retailer

    Problem: Consumer products company was concerned about their US and Canadian tax compliance and the potential exposure to global tax rates of over 40%. The owners desired the ability to be in a tax efficient position should they wish to sell their company.

    Idea: We advised our client to structure their operations and business in a tax efficient manner. We provided a valuation to support the current value of the business, which was critical to the owners. We leveraged our global connections through Nexia International to assist with overseas VAT and related tax issues. We also worked with transfer pricing experts to ensure that the client was compliant with international tax requirements. We assisted in the organization of international subsidiaries, and implemented a reorganization of the various entities – as a means of optimizing tax outcomes at the various taxation levels – resulting in the creation of a structure that minimized overall world-wide taxation.

    Impact: We were able to significantly reduce our client’s global tax rate. The owners retained Canadian residency for tax purposes and reduced their overall tax burden by avoiding significant US and global tax exposure. The owners were provided with a tax road map designed to avoid Canadian, US and global tax traps and maintain compliance on a go-forward basis.

  • A US manufacturer receives a turn-key solution for expansion to Canada

    Problem: We facilitated the set up of a holding company, along with an operating subsidiary registered to do business in various Canadian provinces, all designed to maximize tax deferral opportunities.

    Idea: We registered the entities with all required federal and provincial sales tax, payroll, health and safety and other government authorities.

    Impact: We recommended tax efficient compensation strategies for executives relocated from the US as well as those hired in Canada.

  • A struggling multi-franchised auto dealership gets back in the black

    Problem: A multi-franchise car dealership with four locations was struggling with floor planning payments in arrears, inadequte sales reporting to lenders, .......

    Idea: We worked with the dealership to develop a turnaround strategy, assist in negotiations with creditors, and provide advice on operational improvements.

    Impact: Over approximately 18 months, cash flow improved dramatically and the trust deficiency was reduced by more than half.

  • A former consultant transforms an antiquated auto dealer financier into Canada’s sophisticated market leader

    Problem: We advised on the negotiation of the two stage purchase from the original partners, as well as the optimal structure to fully utilize preferential private company tax rates.

    Idea: We provided accounting advice, and eventual audit services, that transparently disclosed the company’s financial position, enabling it to raise more than $102.5 M in operating capital.

    Impact: We introduced the company to a wide network of North American lenders, and assisted in the negotiation of favourable credit terms that shored up the balance sheet to support continued, lightning speed growth.