When you are planning to go into business, one of the last things on your mind is planning an for the day when close your doors for good. But no business planning is complete without an exit strategy planned out. Whether you are planning to end your business to retire, for health reason or selling up, it is a good idea to have it all planned out to make sure all loose ends are tied up.
Below are considerations when planning on selling your business:
Cancel all your business registrations
As part of the process of selling your business, you will need to notify the Australia Tax Office (ATO). You will also need to notify the Australian Business Register within 28 days of ceasing trading and if applicable, the following registrations;
• your Australian Business Number (ABN)
• goods and services tax (you must apply for the cancellation of registration within 21 days of the day on which you ceased trading)
• PAYG withholding
Ensure you lodge and pay any outstanding activity statements and instalment notices.
Lodge all final tax returns
If your business was operating as a trust or company structure, you will need to prepare a final tax return. You will need to ensure your return covers the period of the financial year up to when your business ceases trading.
Remember to keep your business records for at least five years after the end of the financial year in which you sell or close your business.
GST loose ends
The sale of a going concern, such as a continuing business, is GST free if certain conditions are met. ‘GST free’ means no GST is payable. However, as the seller, you may be able to claim input tax credits for GST you paid on expenses relating to the sale.
CGT concerns
Through the course of your business sale transaction, the matter of Capital Gains Tax will arise. You must factor into account for any possible capital losses that have been previously carried forward.
Selling your business is one of the most important decisions you’ll have to make. Deciding how much your business is worth is one of the main issues you’ll need to consider. Here at The Quinn Group we are able to assist you with selling your business. For more information, please submit an online enquiry or call us on 1300 QUINNS (1300 784 667) or on +61 2 9223 9166 to arrange an appointment today.
