The Corporate Structure Decision Most Owners Only Think About Once, When It's Too Late#
Openfair works with La Pointe Consultants, a fully virtual CPA firm based in Quebec, because the same structural decisions that affect financing, growth, and taxes every year are the ones that quietly determine what a business is worth to someone else later on.
The decision most owners never revisit#
How a business is incorporated, how retained earnings are handled, and whether the company is holding assets that don't belong there, cash, investments, real estate, tend to get set up once and never looked at again. La Pointe sees this constantly: a structure that made sense at year one is still in place at year ten, unexamined, even as the business itself changed completely. The owner who incorporated a two-person operation is now running a company with real revenue, real employees, and a balance sheet nobody has revisited since the original filing.
That inertia has a cost, and it compounds quietly. A corporation carrying too much passive cash or investment property can lose eligibility for tax treatments meant for active businesses. Retained earnings that build up without a plan sit exposed to tax hits that better planning could have avoided years earlier. None of this shows up as a problem until something forces the question: a bank wants clean statements for financing, a partner wants to buy in, or an owner decides to sell.
Signs a structure needs a second look#
A few patterns tend to show up together, and any one of them is worth a closer look on its own:
Retained earnings have grown well past what the business needs for operations, with no plan for how they'll eventually come out
Cash or investments sitting on the balance sheet have grown faster than the operating side of the business
The corporate structure hasn't been reviewed since the business was first set up, regardless of how much the business itself has changed
Real estate or equipment is held personally, or vice versa, without a clear reason tied to current operations
Nobody can say with confidence whether the company would currently qualify as an active business for tax purposes
None of these are emergencies on their own. Together, they're usually a sign the structure was built for a version of the business that no longer exists.
Where it shows up hardest: at a sale#
Selling is the moment these decisions get tested all at once, because a buyer's advisors will look at exactly the things an owner never got around to reviewing. Whether a deal closes as an asset sale or a share sale changes what a seller actually keeps, sometimes by six figures on the same purchase price.
In an asset sale, the buyer purchases the individual pieces of the business, equipment, contracts, customer relationships, goodwill, while the corporation and its history stay with the seller. In a share sale, the buyer takes the company itself, as it stands. Buyers tend to favor asset sales by default, since it lets them choose which liabilities they take on. Sellers often come out ahead with a share sale instead, but only if the shares qualify.
In Canada, a qualifying share sale can unlock the Lifetime Capital Gains Exemption, sheltering over a million dollars in capital gains from tax. Qualifying isn't automatic. The shares generally need to have been held for at least two years, and most of the company's assets need to be actively used in the business rather than sitting as cash or investments building up on the balance sheet. This is exactly where the earlier inertia catches up with an owner. A company that's been quietly stockpiling retained earnings or holding passive investments can fall offside these rules without anyone noticing, and an owner often finds out only after a buyer is already at the table, when there's no time left to fix it.
Why this is worth checking now, not later#
La Pointe works with business owners on the accounting and tax side of these decisions on an ongoing basis, not just when a transaction is already in motion. That includes reviewing whether a company's structure still fits how the business actually operates today, and whether it's positioned to stay eligible for the tax treatment that matters most if a sale ever comes up. Openfair focuses on the other side, connecting sellers to qualified buyers and managing the deal process once the time comes to sell.
Between the two, the structure behind a business gets checked while there's still time to fix it, instead of after an offer has already priced it in. A structure review doesn't require a sale to be on the table. It just requires acknowledging that the setup from year one probably isn't still doing its job.
Where Openfair fits#
If a sale does end up on the horizon, this is exactly the kind of groundwork that makes the process faster and less stressful. Openfair connects sellers with qualified, vetted buyers and manages the deal process end to end, and a free valuation through the Business Valuation Tool at openfair.co is a natural first step once the structural side is in order.
Whether you're planning to sell in five years or not at all, it's worth knowing where your structure actually stands.