Mylène Tétreault
Senior Manager | M. Fisc., B.B.A. Fin. | Tax

Persons who have relinquished or intend to relinquish their U.S. citizenship can, under certain conditions, benefit from a new tax relief program.

This temporary program, with no specific termination date, provides some U.S. citizens living abroad – including in Canada – to correct their tax situation and avoid significant penalties.

Note that all U.S. citizens are required to report their world income and pay U.S. tax, regardless of where they live and work.

The new program, Relief Procedures for Certain Former Citizens, was announced on September 6, 2019 by the Internal Revenue Service (IRS). It is more generous than other similar programs.

Eligible persons will be exempt from paying any tax due, along with applicable interest and penalties. This includes expatriation tax and penalties for failing to file certain tax and financial information returns.

The expatriates tax relief is a significant benefit, because individuals who have relinquished their U.S. citizenship but failed to complete form 8854 (Initial and Annual Expatriation Statement) are usually subject to this tax.

New program: eligible persons

The program applies solely to U.S. citizens, not to green card holders.

To avail themselves of the program, individuals have to meet several conditions, they:

  • relinquished their U.S. citizenship after March 18, 2010;
  • have never filed the U.S. general tax return (Form 1040); however, to submit their application, they must file this form and the required international information forms for the year of expatriation and for the five previous years;
  • do not owe more than a total of US$25,000 in federal taxes in the year of expatriation and in the five previous years, excluding taxes and penalties;
  • have a net worth of less than US$2 million at the expatriation date and at the date of making a submission under the program;
  • have completed and filed form 8854 for the year of expatriation;
  • failed to satisfy their tax obligations involuntarily, based on the good faith assumption.

Note that there is no restriction on the number of days the person stayed in the United States.

Failing to satisfy U.S. tax requirements is risky. Note as well that Canadian financial institutions are required to communicate some of your financial information to the IRS. It’s very important to correct your tax situation or you could be exposed to significant penalties.

How to I apply for this program?

One of the benefits of the new program, unlike other tax exemption programs such as Streamlined, is that it’s not necessary to have a U.S. Social Security Number (SSN). This simplifies the process for individuals who do not have an SSN.

However, the program has a strict process that requires various forms to be submitted, including those mentioned above. Since this is a temporary program, we recommend that you take the required steps as soon as possible.

Our International Mobility team can help by taking charge of your file. We’ll ensure you satisfy the program criteria and file the necessary documents.

We invite you to contact our team if you have any questions in this regard.

09 Oct 2019  |  Written by :

Mylène Tétreault is your expert in taxation for the Québec office. Contact her today!

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Nancy Doucet
Manager | CRHA | Human resources consulting

With the ongoing workforce shortage, the employer brand is a key factor to recruit and retain competent staff for your business.

How can you recruit new staff with the requisite qualifications for the positions to be filled? How do you keep your current employees when there is a labour shortage and extensive competition?

Enterprise leaders must adapt to this new reality and take the volatility of human resources into consideration in their decision process.

The employer brand is more than an image

Using the employer brand is gaining momentum among Quebec enterprises and can be an efficient solution to offset some of the human resource issues they are facing.

Before developing an effective employer brand, your organization must first analyze its identity.

  • What image does it project outside the organization?
  • What is its intrinsic DNA?
  • What sets the organization apart, makes it unique?

Once the identity has been defined, a marketing team will determine the most appropriate tools to promote and showcase it.

This approach makes it possible to target potential employees. The objective is not to please everyone, but rather to draw those workers whose profile meets your organization’s needs.

However, the employer brand is not just a hiring method. It must also be an integral part of the organization’s philosophy and the employee experience.

Finding the right profile is key

Traditionally, recruiting involved posting the greatest number of job openings on the greatest number of channels. This approach could be frustrating for both recruiters and potential employees.

The objective of using the employer brand is to make the organization attractive for the desired profiles. Better targeting makes staff recruiting and retention more effective. It helps to develop digital tools that are consistent with the brand and will work on their own, without the need for advertising. This increases your chances of attracting a steady stream of qualified candidates.

The employer brand must be authentic: the employer’s discourse must reflect the employees’ reality. This is why there must be a strong focus on internal communications. They ensure that employees are understood and shown consideration, while keeping them informed about the organization’s latest news.

From this point of view, what employees say carries a lot of weight. In this age of social media, information about negative experiences travels much faster than good news. Also, a job offer posted by the organization and shared by employees on their social media will have much better visibility, because, let’s face it, information shared by an organization’s employees inspires trust. It provides even more incentive for potential candidates to apply.

The interview shift

Lastly, recruiters must always keep in mind that it is now employees who have the upper hand. It is no longer employees who are interviewed so much as the organizations themselves, employees now have a lot of choice. It is therefore in an organization’s interest to be attractive.

The employer-brand approach can be much less costly than one might think, especially for small businesses that have the advantage of being flexible.

Our experts offer support services for all of the steps of this transition, from the first reflection to adopting the employer brand.

 

08 Oct 2019  |  Written by :

Nancy Doucet is expert in management consulting at Raymond Chabot Grant Thornton. Contact her today!

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Éric Bélanger
Senior Advisor | MBA | Management consulting

You completed your audit 4.0. What do you have to do now to achieve your business’s digital transformation? Where do you begin?

Here you are, recommendations in hand, facing a plan providing you with a clear portrait of your business’s level of digital maturity.

You now have to take action to develop this maturity in line with your strategic planning. But where do you start to achieve your ambitions?

Take action

Step 1: Determine project priority

The 4.0 diagnosis includes a digital plan presenting an overview of the intermediate and digital transformation projects to be implemented.

At a certain point, the business will have to make a final selection of the projects to be implemented based on its budget and implementation plan. It is therefore necessary to determine the critical path for achieving the objectives of the various strategic and operational directions established.

To help you categorize your actions objectively, we suggest that you define some criteria and give them a summary score (between 1 and 5).

You could, for example, use the following criteria:

  • Criticality: Is your project critical? (5 = very critical, 1 = less critical);
  • Immediate realization: Does your project depend on the implementation of other projects?
    (5 = project without other prerequisite projects, 1 = project with several other prerequisite projects);
  • Budget and expected return: Will the return on investment on your project be quick or very significant (5 = project with high expected return, 1 = project with lower expected return);
  • Timeframe: Is the expected end date of your project fixed and achievable (5 = very achievable within expected timeframe, 1 = improbable or unrealistic timeframe);
  • Risk: Does your project involve risks that could negatively affect the company’s performance if they were poorly defined? (5 = low risk, 1 = high risk);
  • Impact: Will the completion or non-completion of your project have an impact on the achievement of your objectives? (5 = significant impact, 1 = no impact).

Then, you will have to add up the scores to obtain an overall score. Higher scores will determine the priority of projects to be implemented.

You will therefore be able to better categorize your projects based on the following priorities:

  • Priority no. 1: important and urgent;
  • Priority no. 2: important and non-urgent;
  • Priority no. 3: not important and urgent;
  • Priority no. 4: (abandon): not important and non-urgent.

Step 2: Analyze project feasibility

Once you have finished prioritizing your projects, some of them with a high number of variables will require more rigorous analysis to determine in greater depth the difference between what the 4.0 diagnosis predicts and the actual situation.

The feasibility analysis therefore confirms whether or not the optimistic view of the digital plan is valid in your situation. It is, to some extent, the ultimate test before making a definitive commitment to the project.

Concretely, you will conduct:

Step 3: Establish project charter

Now that you know your priority projects and are aware that the gap between the 4.0 diagnosis your situation is narrowed, it is essential to finally define the project.

  • Draft a preliminary statement of the purpose of the project.
  • Confirm and specify its objectives.
  • Determine the project’s main actors.
  • Define the project’s authority (its champion).

This charter serves, among other things, to authorize the project and acts somewhat as a contract between the project champion, the various stakeholders and the project team. Of course, you must obtain senior management approval before starting your project.

Step 4: Manage projects

The management steps of technology projects emerging from an industry 4.0 audit are not so different from those of another type of project, i.e. planning, execution, control and finalization.

However, not everyone is comfortable with technologies. This is one of the reasons why projects relating to the digital shift bring their share of challenges.

You will have to adapt your management style, as the projects will be affected by new elements, that companies are not familiar with:

  • internet of objects,
  • additive manufacturing,
  • system integration,
  • autonomous systems,
  • augmented reality,
  • simulations,
  • massive data,
  • cybersecurity,
  • cloud computing.
Raymond Chabot Grant Thornton - image

Project managers don’t have to be experts in all of these fields, but they must act as digital transformation leaders and coaches.

That said, don’t be afraid to ask for help. Support by experts in digital and organizational transformation can make all the difference between facing the future with confidence and conviction and remaining immobilized in the status quo.

Key factors for success:

Get your employees involved in your digital transformation from the very beginning of the project
An employee who is engaged and committed to the success of your growth projects will become a positive leader and excellent ambassador for your employer brand.

Put employee health and safety first
New technologies and robots will require special attention and handling. Standards, employee interaction, workspace reconfiguration and risk management are matters to consider in your transformation.

Be realistic
Not everyone has the same digital maturity, and a technology project involves resources and expertise. Start on the right track with the support of business advisors.

Establish measurable objectives
Without a goal, it will be difficult for you to measure the impact of any change. Assess your results regularly, that way you can consider improvement measures quickly instead of lingering in a doomed situation.

Aim for small victories
What pays off quickly is extremely motivating and instills the desire to surpass oneself and go even further.

Challenge your business model
Ask yourself: Does it contribute to or hamper your progress.

Invest in training
Trained and informed employees will be more productive and more likely to present new ideas and innovate. Training is an important factor when it comes to considering your future in a company.

Don’t overlook the importance of proper communication
Taking the time to explain the reason for the changes will promote a better understanding on the part of all staff and it will be easier to get your resources on board with on this new adventure.

Develop a change culture management plan and listen to your employees
You would be surprised to see how much they can contribute in ideas and suggestions for improvement.

Don’t try to do it alone
Your projects will require a good financial investment and will require much from your resources. Being supported by experts will make the task manageable for all.

In a context of digital transformation, the magnitude of the technological challenges facing organizations is relatively large. For most SMEs, a technology project can be a daunting adventure.

Beyond competitiveness, you will have to take a look at your how you manage your human resources who are essential to the growth of your organization. A technological project can quickly become demanding for your employees in addition to taking them out of their comfort zone. That’s why it’s important to implement ways to retain your resources and keep them mobilized.

Feel free to call on our experts in information technology, business strategies and models, organizational performance and human resources management to assist you in all stages of the implementation of 4.0 projects, such as:

  • the realization of an information technology master plan;
  • the management of technological projects;
  • guidance in selecting computer systems;
  • guidance in implementing computer systems;
  • business strategies and models;
  • organizational performance;
  • human resource management.

04 Oct 2019  |  Written by :

Éric Bélanger is a leader in operational performance and digital transformation. Contact him now.

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You built your SME with your sweat of your brow and plan to pass the torch in the next three to five years. Some key employees could become the ideal buyers to ensure your enterprise’s sustainability.

In some regions of Quebec and in several activity sectors, the work force shortage is a major issue that requires SMEs to be quite agile. In this respect, an effective and timely succession plan is a very useful tool to retain the best talent within the organization.

Some of your best-performing employees could therefore be involved in the eventual transaction, becoming future shareholders. To this end, communication between the transferor and potential buyers must be clearly established. The current business owners must indicate their intentions. If they want to leave the organization in five years, they need to be up front about it. Nowadays, business succession is no longer just a family matter.

Therefore, have the courage to discuss the issue directly with those you think could eventually take over internally. Three steps make it easier to complete this transition project.

A– Identify key employees

Have the employees you’re considering established a career plan? Do they have the requisite entrepreneurial skills? What are their professional goals? These discussions set the stage for the next steps. For example, you could give targeted employees a few management assignments in advance to gauge their interest and see if they have the right job profile.

These additional responsibilities assigned over time can also facilitate the transfer of authority. The financial capacity of the buyers to obtain the required financing should also be considered. They can then benefit from a gradual integration into the shareholding structure. At the same time, the buyers will increase their participation in the organization.

B– Get help

Entrepreneurs obviously can’t do everything alone. People who transfer ownership of a company they’ve been running for 25 years sometimes think they can navigate the transfer maze on their own. Beware of this wishful thinking. The support of a specialist can make all the difference in the development of a succession plan. Using an external resource ensures that you have a fresh perspective on the situation. And what could be better than to be able to count on leading-edge expertise to leave nothing to chance?

Lastly, remember that a business transfer is not something you can improvise. By relying on a specialized team, you can anticipate potential problems and gradually transfer the required knowledge. Transferors should not disappear overnight following the conclusion of the transaction.

C– Ensure a smooth transition

Over time, potential buyers will put their own stamp on the business. The transferor and buyer should expect an overlap during the transition process. It is not uncommon to see the buyer get involved during the first year following the transfer and even to hold the position of board chair. This type of transfer doesn’t just take place at the time of the visit to the notary’s office: rather, it is spread over a period of time.

You have to trust the leaders you choose to carry out the process. They may have different methods, but you have to accept these differences. For their part, buyers must understand that it is a part of yourself that you’re leaving in their hands.

Get employees involved and ensure their loyalty

If you plan to withdraw from the business, state your intention early enough to allow for the development of a proper succession plan.

By letting it be known that there are opportunities for advancement as a result of your eventual departure, you give key employees a chance to demonstrate their interest and skills and, perhaps, invest their energy in ensuring the sustainability of “their” SME. That way, you can be sure that you can count on your best collaborators in the coming years.