How Much Will You Walk Away With?
Selling your business for $5M does not mean you walk away with $5M. By the time you repay outstanding debt, cover advisory and legal fees, and account for tax, the number in your bank account can look very different from the headline price.
This calculator gives you a realistic estimate of your net proceeds based on your specific situation. It takes under two minutes and requires no registration.
Note: This calculator is for planning purposes only. It does not constitute tax, legal, or financial advice. Always consult your accountant and legal advisor before making decisions based on these figures.
What This Calculator Covers
The calculator works through four layers of deductions that apply to most Canadian business sales:
Debt repaid at closing. Most purchase agreements require outstanding business debt and shareholder loans to be cleared from the proceeds at closing. This is often the largest single deduction and catches owners off guard if they have not accounted for it.
Transaction costs. Advisory fees and legal costs typically run 4 to 7% of the sale price combined on owner-managed business transactions in Canada. These are paid from proceeds and reduce your net figure directly.
Working capital adjustments. Most deals include a target working capital amount. If the business delivers more than the target at closing you receive additional proceeds. If it delivers less, the purchase price is reduced. The impact can be significant on larger transactions.
Tax. The tax treatment of a business sale in Canada depends heavily on whether the deal is structured as a share sale or an asset sale, your adjusted cost base, and whether you qualify for the Lifetime Capital Gains Exemption. This calculator provides a rough estimate only. Your actual liability needs to be assessed by your accountant well before you go to market.
Why the Gap Between Headline Price and Net Proceeds Matters
Most business owners focus on the sale price. Sophisticated buyers and their advisors focus on structure.
A buyer who offers $4M structured as an asset sale may leave you with less after tax than a buyer who offers $3.8M structured as a share sale. A deal with a working capital peg you do not understand can cost you hundreds of thousands of dollars at closing. Advisory fees you negotiate hard on can more than pay for themselves through a better price.
Understanding what you will actually walk away with before you engage with buyers gives you the clarity to evaluate offers properly and make better decisions throughout the process
Getting the Most From Your Sale
There are three ways an advisor typically improves the net proceeds figure beyond what an owner achieves on their own:
Better price through process. A well-run sale process with competitive tension consistently produces higher headline prices than a single-buyer negotiation. The difference is typically measured in multiples of advisory fees.
Deal structure. How a transaction is structured affects your tax liability, your exposure to post-closing adjustments, and the risk you carry after closing. An experienced advisor can identify structural improvements early in the process.
Working capital and closing mechanics. The working capital peg, earnout provisions, holdbacks, and representations and warranties are all negotiable. Owners who negotiate these without experienced support frequently leave money on the table.
Our Insights
Speak With Us
If you are thinking about selling your business in the next few years, the best time to start the conversation is now — before you need to.
Call (604) 762-6225 or fill out our contact form. We respond within one business day.
KitsWest Capital: Independent M&A Advisory | Business Valuations | Debt & Capital Advisory