How Long Does It Take to Buy a Business in Alberta?
This answer covers the law of Alberta.
There is no set timeline, and how long it takes depends mostly on the size of the business, how organized the seller's records are, and how quickly your lender and third parties respond. The main stages are agreeing terms, due diligence, arranging financing, getting consents and closing. Each can run alongside the others, but delay in one often holds up the rest.
Financing is a common source of delay. If you use the Canada Small Business Financing Program, financing is capped at the lower of the purchase price or the appraised value of the eligible assets, so the appraised value will affect how much you can borrow. The program does not finance share purchases, so a share purchase of an Alberta company needs another funding source.
Tax paperwork also needs timing. Where the GST election is available and the buyer is a registrant, it must file the election with the Minister by the filing deadline for its first reporting period in which tax would otherwise have become payable. The election is made on CRA form GST44. Ask your lawyer and accountant to build a closing schedule so these steps do not collide.
Key takeaways
- There is no set timeline, because it depends on the size of the business, the seller's records and how quickly lenders and third parties respond.
- Canada Small Business Financing Program financing is capped at the lower of the purchase price or the appraised value of the eligible assets.
- That program does not finance share purchases, so a share purchase of an Alberta company needs another funding source.
- Where the GST election is available and the buyer is a registrant, the buyer must file it by the deadline for its first reporting period in which tax would otherwise have become payable.