CGT on Biz Sale

Sell biz for 1 mil, started with nothing.
How is CGT calculated?

 

Way more complicated.

Whats the break down of the 1mil in terms of goodwill, assets, inventory, etc?

 

More complicated than what exactly, no example was given.

Anyway, say zero inventory and negligible assets in this example.

 

what is the cost base - would be very low. So the gain will be very high.

but luckily there are various small business CGT concessions.

 

You've give no where near enough information to even hazard a guess to the CGT consequences...

How long was it owned? What's the turnover and net assets? What structure is it owned in? How was it sold (if it's a company did you sell the business or the shares? What's it do even? How old are the owners?

If you've owned it for 15 years and meet the SBE criteria it's perfectly plausible there will be no CGT at all, if you've owned it for 5 weeks you're probably going to get smashed.

 

Depends if he is looking to buy a few IP's in his smsf. Potential to roll over the net cg into super.

Spend the money - pay for some advice BEFORE selling the business...

 

Well if he has owned it for 15 years and is either over 55 or permanently incapacitated and qualifies for the SBE CGT concessions then the entire gain could be exempt and doesn't even need to roll into super.

Hence the comment he hasn't given us even remotely close to enough information to give any kind of informed comment on the scenario.

As you said though, he should just spend the money, getting the right advice from a good accountant could actually save you hundreds of thousands just based on the incredibly basic information provided.

 

Agreed, this isnt a forum question, pay for specific advice.

There is some relevant info here Small business CGT concessions | Australian Taxation Office

 

Thanks for the comments guys, a few good ideas there.
Rolling over the CG into Super is a good one.
Under 55 and owned less than 15 years, so the SBE CGT concession probably won't apply.

I'll definitely be scheming some strategies with my good accountant prior to selling on how we can minimise any tax payable on a sale.

 

This would be better suited to take to an accountant for qualified paid advice, taking into account your personal circumstances & structure & tax impact