Objective
A Tax Impact Simulator is being built to help Greg and Korey evaluate sale structure options for both companies:
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Total Lease & Truck Sales Ltd. (OpCo)
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Teramo Properties Ltd. (PropCo)
Crowe MacKay’s December 24, 2025 memo confirmed that a share sale with LCGE provides significantly better after-tax outcomes — potentially $2M+ in tax savings versus an asset sale.
Seller Tax Framework — OpCo
Total Lease & Truck Sales Ltd.
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| Share Sale | Source | Asset Sale | Source |
|---|
| Purchase Price Breakdown |
| — | | $5,000,000 | Crowe assumption |
| — | | $441,496 | Crowe assumption |
| — | | $3,358,504 | Balance Sheet Aug 31/25 |
| $7,600,000 | Crowe memo | — | |
| Gross Proceeds | $7,600,000 | | $8,800,000 | |
| Less: Taxes |
| — | | $522,396 | Net of dividend refund |
| — | | $1,882,976 | After liabilities paid |
| $1,925,870 | | — | |
OpCo Share Sale Scenarios (LCGE & RRSP Impact)
The tax impact of the LCGE and RRSP offset were not individually broken out as the inputs in the tax return work together to provide the most beneficial result.
12 Information Inputs — Crowe MacKay Responses
1
UCC for OpCo Equipment
What is the Undepreciated Capital Cost for OpCo equipment?
Crowe’s Answer
$184,831 across 5 CCA classes:
Class 8 — $73,236 | Class 10 — $74,861 | Class 45 — $1 | Class 50 — $1,916 | Class 14.1 — $34,817
2
ACB for OpCo Shares
What is the Adjusted Cost Base for OpCo shares?
Crowe’s Answer
$24 — 2,400 shares issued with an ACB of $0.01 per share.
3
ACB for PropCo Shares
What is the Adjusted Cost Base for PropCo shares?
Crowe’s Answer
$24 — 2,400 shares issued with an ACB of $0.01 per share.
4
ACB for PropCo Land & Building
What is the ACB for PropCo land and building?
Crowe’s Answer
$2,252,538
Land ACB: $816,430 | Building ACB: $1,436,107 | Building UCC: $350,078
5
Corporate Tax Rate
What corporate tax rate applies? (Small business / General / Blended?)
Crowe’s Answer
Total Lease: Combination of 11% small business rate and 50.67% passive income rate (partially refundable at 30.67%).
Teramo: 27% high-rate and 50.67% on passive income (partially refundable at 30.67%).
Crowe assumed the available SBD would be fully allocated to Total Lease. The calculation does not account for income from regular operations throughout the year.
6
Dividend Tax Rate
What dividend tax rate applies? (Eligible / Non-eligible / Combined Fed+BC?)
Crowe’s Answer
Capital dividends:
0%
Eligible dividends (to extent of GRIP available):
36.54%
Non-eligible dividends (remainder):
48.89%
Tax rates provided are for the highest marginal tax bracket.
7
Capital Gains Inclusion Rate
What capital gains inclusion rate applies? (50% first $250K, 66.67% above?)
Crowe’s Answer
Inclusion rate of
50% is used for all capital gains.
Proposed increase in capital gains inclusion rate was cancelled in March 2025 and no further inclusion rate changes have been proposed.
8
LCGE Room per Shareholder
What is the remaining Lifetime Capital Gains Exemption room for each shareholder?
Crowe’s Answer
Greg:
$1,250,000
Peggy:
$1,250,000
Korey:
$1,223,658
Kerry:
$1,250,000
Used the increased total LCGE amount of $1,250,000 for 2025, set to increase to $1,275,000 in 2026. AMT may still apply despite LCGE use (potentially recoverable over seven years).
9
RRSP Room
Confirm RRSP room per shareholder.
Crowe’s Answer
Greg:
$512,397 | Peggy:
$175,763
Korey:
$226,143 | Kerry:
$181,964
Amounts agree to RRSP deduction limits in CRA Represent-a-Client as of Feb 3, 2025. Do not consider 2025 income additions or planned RRSP contributions in 2025 returns.
10
Inventory Tax Treatment
Confirm: Is inventory sold at book value tax-neutral?
Crowe’s Answer
Yes, if sold at cost, the result will be tax neutral.
If sold above cost, the amount is generally considered active business income (not capital gain).
11
PropCo Mortgage Balance
Confirm PropCo mortgage balance (~$1.8M)?
Crowe’s Answer
$1,835,779.12 as per Teramo’s August 31, 2025 bank statement. Per amortization schedule, approximately
$1,802,482 as of February 2026.
12
Ownership Split
Confirm ownership split: 50% Greg family / 50% Korey family?
Crowe’s Answer
Total Lease:
35% The Korey Gaspari (2015) Family Trust
35% The Gregory Gaspari (2015) Family Trust
15% held directly by Kerry
15% held directly by Peggy
Teramo:
50% The Korey Gaspari (2015) Family Trust
50% The Gregory Gaspari (2015) Family Trust
Beneficiaries of each trust include the principal, spouse, children, and holding companies. Crowe considered distributions to the four principals and their children only.
Buyer-Side Tax Inputs — Future Request
After the Seller Tax Simulator, a mirror model will be built for the Buyer side to quantify:
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What it costs sellers if buyer insists on asset deal
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What it saves the buyer (NPV of tax shield)
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The gap = negotiation room for price adjustment
No action needed from Crowe at this time — this is for awareness of upcoming inputs.