Buying a Business in Ontario: Due Diligence Document Checklist

A printable Ontario checklist of the documents and searches to request before closing a business purchase, with why each matters and where to get it.

⚖️ This is general information, not legal advice. It can't account for your specific situation. Use it to get oriented, then confirm the details with a licensed Ontario lawyer.

This checklist is for people buying an existing business in Ontario, whether you are buying its assets or the shares of the corporation that owns it. It groups the documents and searches a buyer usually asks for before closing, and for each one it notes why it matters and where it is generally obtained. Print it and work through it with your lawyer and accountant. Each item ends with two blanks: who is responsible for getting it, and the date it arrived. Not every item applies to every business, and fees change from time to time, so confirm current costs before you order anything.

Start here: asset purchase or share purchase

Ontario's Bulk Sales Act was repealed on March 22, 2017, so a buyer no longer gets a statutory bulk-sales affidavit, creditor notice or court order. Protection against the seller's debts now has to come from searches, clearance or purchase certificates, holdbacks and indemnities in the agreement.

The type of deal changes the list. In a share purchase the corporation remains the same legal entity, so employees' service and any accrued ESA liabilities stay with the corporation you now own. A share purchase is also generally not subject to GST/HST, so the GST44 election is not relevant to it. In an asset purchase you take specific assets and contracts, which is why consents, discharges and allocations matter more. Ask your lawyer which route applies to your deal.

Corporate records and minute books

• Articles and by-laws with all amendments, and any known unanimous shareholder agreement. They show how the corporation is governed, and a corporation must keep them. Source: the seller's minute book. Responsible: ______ Date received: ______
• Minutes and resolutions of shareholders, the register of directors and the securities register. They show who the directors and shareholders are. Source: the minute book. Responsible: ______ Date received: ______
• Minutes and resolutions of directors' and committee meetings, plus accounting records. Use them to verify approvals of past transactions, dividends and loans. Source: the seller. Responsible: ______ Date received: ______
• Register of individuals with significant control. Privately held Ontario corporations must keep one, and it helps you confirm who really owns the target. Public corporations and their wholly-owned subsidiaries are exempt. Source: the seller. Responsible: ______ Date received: ______

Corporate status and public-record checks

• Ontario Business Registry basic search. It is free. It is a quick first check that the seller exists as described. Responsible: ______ Date received: ______
• Profile Report. It shows current information, active directors and officers and name history, and costs $8 online or by mail. Responsible: ______ Date received: ______
• Certificate of Status for a corporation. It costs $26, and intermediaries may add service fees. Responsible: ______ Date received: ______
• If the seller is a sole proprietor or partnership, note that a business name cannot be status-certified the way a corporation can, because the business name fee table has no Certificate of Status. Ask your lawyer what to rely on instead. Responsible: ______ Date received: ______

Lien, writ and insolvency searches

• Personal Property Security Registration search through ServiceOntario's Access Now. Search the seller's exact corporate name plus any former or trade names to find liens on inventory, equipment and receivables; online and certificate responses are $8 each. Responsible: ______ Date received: ______
• If a lien shows on assets you are buying, plan for a discharge registered before the sale or payoff at closing, and include discharges or a direction to pay out the secured creditor in the closing documents. Responsible: ______ Date received: ______
• Execution search for unsatisfied writs against the seller and its former names, at the Superior Court of Justice enforcement office in the county where the business operates. Confirm the current process and fees with your lawyer. Responsible: ______ Date received: ______
• Bankruptcy and insolvency records search with the federal Office of the Superintendent of Bankruptcy. It covers bankruptcies and proposals since 1978, receiverships since January 1993 and CCAA protection since September 18, 2009; searches cost a minimum of $8 (CCAA records are free) and need a GCKey or Sign-In Partner login. Responsible: ______ Date received: ______

CRA, GST/HST and payroll

• The seller's CRA business number and payroll (source deduction), GST/HST and corporate tax account statements and filed returns. You may need a new business number and program accounts after the purchase. Responsible: ______ Date received: ______
• For an asset purchase, ask your accountant about the joint GST/HST election on Form GST44 under s. 167(1) of the Excise Tax Act, which applies if you acquire all or substantially all (90% or more) of the property needed to carry on the business. Responsible: ______ Date received: ______
• Check the election's limits. It is not available if the seller is a GST/HST registrant and you are not, and it does not remove GST/HST on certain services, leases or licences. Responsible: ______ Date received: ______
• Seller's capital cost allowance schedules and fixed-asset lists, so the price can be allocated to each asset at fair market value, then inventory, with the remainder to goodwill in CCA Class 14.1. Responsible: ______ Date received: ______
• If you are related to the seller (family, shareholders), obtain CRA account balances and tax returns. Under s. 160 of the Income Tax Act, a transfer to a non-arm's length person for less than its value can make transferee and transferor jointly liable for the transferor's tax, up to the lesser of the excess of the property's fair market value over what was paid and the transferor's total tax liability. This can apply whether or not the tax has been assessed at the time of the transfer. Responsible: ______ Date received: ______
• Do not treat a CRA clearance certificate under s. 270 of the Excise Tax Act as a buyer's clearance. It protects a representative such as a receiver or liquidator, not a buyer in an arm's-length asset sale. Responsible: ______ Date received: ______

WSIB purchase certificate

• Request a WSIB purchase certificate before the date of sale. If the original employer owes WSIB money and the purchaser does not have a valid purchase certificate as of the disposal date, WSIB holds the purchaser liable for the amounts the original employer owes relating to the business or part acquired. Either the seller or the buyer, or their representatives, may request it. Responsible: ______ Date received: ______
• Diarize the 30-day validity from the issue date printed on it. If closing slips beyond that, a new certificate must be requested. Responsible: ______ Date received: ______
• Confirm the seller's WSIB account is in good standing, since that is a condition of issuing the certificate. If the seller has several accounts, you need a certificate for each. Responsible: ______ Date received: ______
• In a share sale, WSIB says a purchase certificate is not required, but the Share Purchase Agreement must still be submitted to WSIB. Responsible: ______ Date received: ______

Employees and ESA liabilities

• A list of employees showing seniority, wages, vacation and leaves. In an asset purchase, if you employ a seller's employee, the employment is deemed not terminated and the seller's service counts toward your later termination, severance and vacation calculations under s. 9(1) of the Employment Standards Act, 2000. Responsible: ______ Date received: ______
• Written employment contracts, bonus plans and any termination terms. Review them for what you would inherit. Responsible: ______ Date received: ______
• Check the timing exception: continuity does not apply if you hire the employee more than 13 weeks after the earlier of their last day with the seller and the day of the sale. Responsible: ______ Date received: ______
• Remember that 'sells' includes leases and other transfers, and that the continuity provision cannot be waived, so an agreement that tries to reset service does not remove the liability. Responsible: ______ Date received: ______
• Model severance for long-serving staff. Severance pay is owed to employees with five or more years of service where the payroll is $2.5 million or more, or where 50 or more employees are severed within six months because of a permanent discontinuance, up to a maximum of 26 weeks. Responsible: ______ Date received: ______
• The payroll threshold is measured on the employer's global payroll, and it is met if any one of the three calculation periods reaches $2.5 million. Responsible: ______ Date received: ______

Leases, contracts, licences and financial statements

• The commercial lease and all amendments. Read its own wording on assignment, change of control and consent first, because a signed lease may take precedence over the Commercial Tenancies Act. Responsible: ______ Date received: ______
• Written landlord consent to the assignment, and an estoppel, before closing an asset deal. Under s. 23(1) of the Commercial Tenancies Act consent is not to be unreasonably withheld unless the lease expressly provides otherwise. Responsible: ______ Date received: ______
• If a landlord refuses or ignores a request, a Superior Court of Justice judge may decide whether the refusal is unreasonable and, if so, permit the assignment, which then counts as consent. Ask your lawyer early. Responsible: ______ Date received: ______
• Key customer, supplier, franchise, equipment and software contracts, with a note of which need the other party's consent to assign or on a change of control. This depends on each contract's wording. Responsible: ______ Date received: ______
• Licences and permits the business needs to operate, with expiry dates and whether they transfer. This varies by industry, so confirm with your lawyer. Responsible: ______ Date received: ______
• Financial statements and filed tax returns for several recent years, with monthly figures since the last year end. Your accountant can say how many years suit this deal. Responsible: ______ Date received: ______

Real property and environmental searches

• The parcel register and registered instruments (mortgages, liens, easements, executions) for any premises being bought. Ontario's land registry is online only; OnLand is the public self-search service and Teraview is for licensed users, and ServiceOntario cannot search or explain records for you, so a lawyer or title searcher is usually used. Responsible: ______ Date received: ______
• Remember that the PPSR search covers personal property only. Land and mortgages must be searched separately through the land registration system (OnLand or the Land Registry Office). Responsible: ______ Date received: ______
• Any Record of Site Condition and Phase I or II environmental site assessments for industrial or commercial land. Once an RSC is filed under O. Reg. 153/04, certain orders for historic contamination generally cannot be issued against the person who filed it or later owners or occupants. Responsible: ______ Date received: ______
• Treat an RSC as one input only. Protection for a former owner applies only if the property was sold under an agreement requiring the purchaser to file an RSC and the purchaser did so, or the former owner owned the property when the RSC was submitted. Responsible: ______ Date received: ______

Turning the results into protection

Once documents arrive, mark each item received, then flag anything missing, late or surprising. Findings should feed the agreement. Because there is no bulk sales regime to rely on, holdbacks, indemnities and warranties carry more weight, and they work alongside your searches and certificates.

Check closing dates against anything that expires, such as the WSIB purchase certificate. If the seller cannot produce an item, treat that as information, and ask your lawyer whether to delay, adjust the price or add protection.

How Treadstone Law can help

Due diligence is mostly about asking early and writing down what you receive. Take this list to your lawyer and accountant, who can tell you which items matter for your deal and what to add for your industry.

Treadstone Law handles corporate matters on a transparent flat fee, with online intake and a real lawyer on your file, across Ontario.

• Start your file online at treadstonelaw.ca/start-file
• See flat-fee pricing at treadstonelaw.ca/pricing
• Learn more about our corporate services at treadstonelaw.ca/corporate
• Or call us: 1-844-900-1070

This is not legal advice

This guide is general information, not legal advice. Reading it does not create a lawyer-client relationship. Ontario laws and government programs change, and how the law applies depends on your specific facts. For advice about your situation, speak with a licensed Ontario lawyer. Treadstone Law is licensed by the Law Society of Ontario — reach us at 1-844-900-1070 or start a file online.