For Sellers
July 2026 · 6 min read
Share Sale Or Asset Sale: Which Is Right For Your Practice?
The structure decides your after-tax proceeds, the buyer’s risk and how the lender sees the deal. Decide it before you list, not at the offer.
Every incorporated practice is sold one of two ways. In a share sale the buyer purchases the shares of your professional corporation and takes the company as it stands, clients, contracts, liabilities and history. In an asset sale the buyer purchases the client list, work in progress, equipment and goodwill, and your corporation keeps everything else. Sellers usually prefer shares; buyers usually prefer assets; the price and structure settle the difference.
The seller’s reason is the lifetime capital gains exemption. A share sale of a qualifying small business corporation can shelter a substantial gain from tax, which on a $1M practice is a very large after-tax difference. An asset sale does not qualify, and the proceeds come out of the corporation as dividends or salary over time. Your accountant will run both scenarios; the gap is often the single biggest number in the deal.
The buyer’s reason is liability. Buying shares means buying the past: old engagements, old staff issues, old tax filings. Buying assets means starting clean. Buyers also get a tax deduction on purchased goodwill in an asset sale, which they do not get on shares. So a buyer will typically pay less for shares than for the same practice’s assets, and a seller has to weigh a lower price against a better tax outcome.
Québec practices and multi-partner firms lean more often to share deals and partner buy-ins, where the incoming partner buys an interest rather than the whole practice. Sole practitioners in Ontario and the West more often sell assets. Neither is a rule; both are negotiated.
What usually works: decide your preferred structure with your accountant before the practice is listed, market it on that basis, and know your walk-away price under each structure. A buyer who wants assets when you want shares is not a problem if you know what the difference is worth to you.
We prepare both scenarios for every seller before listing, so the structure is part of the valuation rather than a surprise at the offer.
Talk To A Broker
Michael Hartley, CPA, CA covers Ontario And Atlantic Canada. The first conversation is free and confidential.
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