Bulletin
FROM:
MAY-JUN 2005 ISSUE
Succession Planning
The number of Canadian entrepreneurs nearing retirement has grown by
7.5 per cent annually since the beginning of the decade, according to a recent CIBC report. By 2020, half of the nearly 2.5 million small business owners in Canada expect to be retired.
Yet a staggering 60 per cent of entrepreneurs aged 55 to 64 have not discussed exit strategies with family or business partners, and only
15 per cent have made definite plans to transfer or sell their business to a family member.
Better succession planning is essential: a small business principal strength — the reliance on the human capital of the owner — is also becoming its primary weakness, since adequate succession planning requires years, not days or months.
Some other figures:
- 70 per cent of entrepreneurs own RRSPs, compared to
55 per cent of paid employees.
- Only 22 per cent of small business owners maximized their RRSP contributions in 2003.
- Those self-employed under the age of 35 expect to retire by the time they are 54. The actual average retirement age for entrepreneurs is 62.
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First Nations, CRA Working Together
The Canada Revenue Agency (CRA) and the Assembly of First Nations (AFN) recently announced the creation of a First Nations Advisory Committee to help the CRA identify and address tax and benefit administration issues affecting First Nations peoples.
The federal government is committed to working more closely with First Nation communities to enhance the conditions they need for long-term development while respecting historical rights and agreements.
The AFN has worked in partnership with the CRA in developing the mandate of the committee, as well as defining the roles and responsibilities of committee members. The committee will be co-chaired by a representative of the CRA and a First Nations representative who will be selected by and from the First Nations representatives on the committee.
A majority of the committee will be First Nations peoples selected from all regions of the country.
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