Selling or closing your business - things to consider

The Tax Office offers business owners an overview of tax related issues that may need to be addressed prior to the sale or closing of a business.

It is emphasised by the Tax Office that the guide is not exhaustive, but seeks to be a starting point for recurring topics pertinent to the sale or closing of a business, including:

• Goods and services tax (GST);
• Capital gains tax (CGT);
• Superannuation;
• Winding up a company;
• Record keeping and lodgment obligations; and
• Cancelling registrations.

The guide notes that GST implications may arise following the disposal of capital assets and business owners should familiarise themselves with the treatment of such transactions.

The Tax Office highlights the availability of various CGT concessions to small business owners and the appropriate application of the concessions may minimise CGT liabilities when selling a business.

Business owners may still be required to complete an activity statement for the tax period in which their registration is cancelled. PAYG instalment obligations may still exist until the date of business cessation and instalment activity statements may be received even after cancellation of the Australian business number (ABN).

Lastly, the Tax Office has developed a structured checklist to assist business owners in meeting their requisite tax obligations when selling or closing their business.

Click here to access the guide.