Most owners think about a business sale as a negotiation. Get the price right, and everything else follows.
The price matters, but it is not what determines the outcome. What you keep depends on how the business is owned, whether you qualify for the small business capital gains tax concessions, how much of the proceeds can be moved into superannuation, and when the sale happens. Several of those are effectively locked in long before a buyer appears.
The difference between a well-planned exit and an unplanned one on the same sale price is routinely hundreds of thousands of dollars. Almost all of that difference is created in the two years before settlement, not at the negotiating table.
Before: the twelve to twenty-four months that decide everything
Check who actually owns what
The concessions apply to the entity that makes the capital gain. Whether the business is held personally, through a company, through a discretionary trust, or in some combination determines who can access what, and how proceeds ultimately reach you.
Where the business premises sit is often the biggest single item. Property held in an SMSF, in a separate trust, or personally alongside a trading company each produces a materially different result on sale.
Restructuring in the lead-up is possible but treacherous. Some restructures reset ownership clocks that the concessions depend on, and a restructure done with a sale in contemplation attracts a different level of scrutiny than one done for genuine commercial reasons. This is the argument for starting the conversation early rather than three months out.
Work out whether you pass the basic conditions
Before any of the four concessions apply, you must satisfy the basic conditions. Broadly, that means the asset is an active asset, and either the business is a small business entity by aggregated turnover, or you satisfy the maximum net asset value test.
Where the asset being sold is shares in a company or an interest in a trust rather than the business assets themselves, additional conditions apply, including tests around significant individuals and CGT concession stakeholders. These are among the most technically demanding provisions in the tax law, and eligibility is frequently assumed rather than confirmed.
Confirm it with a specialist. An owner who discovers at settlement that they do not qualify has no remedy.
Understand which concession you are aiming at
There are four, and they are not equal.
The 15-year exemption is the prize. Where you have continuously owned the asset for at least 15 years and you are 55 or over and the sale happens in connection with your retirement, or you are permanently incapacitated, the entire capital gain can be disregarded. Not reduced. Disregarded.
The conditions are precise, which means the calendar matters enormously. An owner at fourteen years and eight months, or turning 55 in four months, has a very strong reason to control the timing of the contract. Check both clocks early.
The 50% active asset reduction halves the remaining gain, and can apply on top of the general CGT discount.
The retirement exemption allows up to $500,000 of capital gains to be disregarded across your lifetime. It is not indexed. If you are under 55, the exempt amount must go into superannuation. If you are 55 or over, you can take it as cash.
The rollover defers a gain where you acquire a replacement active asset, which suits owners moving into another business rather than retiring.
They apply in a mandated order and can be combined, and the optimal combination differs depending on your entity structure, your age, and what you intend to do with the money.
Get your superannuation position ready
This is where a business sale becomes a retirement plan.
Amounts disregarded under the 15-year exemption and the retirement exemption can be contributed to superannuation under the lifetime CGT cap, which is $1,935,000 for 2026-27, without counting against your non-concessional contributions cap. The retirement exemption portion is limited to $500,000 within that.
Two features make this extraordinarily valuable. Your total superannuation balance does not restrict CGT cap contributions the way it restricts non-concessional contributions, so an owner already near the caps can still use it. And the money enters a concessionally taxed environment in a single event that may never repeat.
The mechanics are unforgiving. The election must be made on the approved form and given to the fund at or before the time the contribution is made. Contributions generally need to be made within 30 days of receiving the relevant proceeds. Funds cannot usually accept contributions once you are past 75. Miss any of those and the contribution is assessed against your non-concessional cap instead, which can create an excess.
Separately, the years before a sale are a good time to use the concessional cap, which is $32,500 for 2026-27, and to check whether carry-forward amounts are available if your total super balance was under $500,000 at the previous 30 June.
Clean up the business itself
Buyers pay for clarity. Reliable financial statements, normalised earnings, documented processes, resolved disputes and a business that is not wholly dependent on you all raise price and reduce the risk of a deal collapsing in diligence.
Reducing owner dependency in particular takes eighteen months, not eight weeks, which is another reason the planning window is longer than people expect.
The 1 July 2027 timing question
This is the most important thing on this page for anyone contemplating an exit in the next two years, and it is more nuanced than most current commentary suggests.
Two changes commence on 1 July 2027, and they pull in opposite directions.
Against waiting. The general 50% CGT discount for individuals, trusts and partnerships is replaced by cost base indexation combined with a 30% minimum tax rate on net capital gains. For sellers who rely on the general discount, whether stacked with the 50% active asset reduction or applied on its own, the arithmetic gets less favourable.
In favour of waiting. Following consultation, the turnover threshold for the small business 50% active asset reduction increases from $2 million to $10 million from 1 July 2027. That change applies to that concession only, with the 15-year exemption, retirement exemption and rollover keeping their existing eligibility thresholds. A business with turnover between those figures that cannot access the 50% reduction today may be able to after that date.
So there is no single right answer.
If you qualify for the 15-year exemption, the whole gain is disregarded and neither change is decisive. If you are relying on the general discount and already qualify for the small business concessions, an earlier contract may serve you better. If your turnover sits between $2 million and $10 million and you currently fail the small business entity test, waiting may open a concession that is closed to you now.
For a share or business sale, the contract date generally determines which regime applies, not settlement. That gives you a lever, and it is worth modelling both sides before signing anything.
During: the transaction itself
Share sale or asset sale
Buyers usually prefer to buy assets, because they take on less history and get a fresh cost base. Sellers often prefer to sell shares, because it is a cleaner exit and can produce a better tax result. The gap between those preferences is a negotiating point with real money attached, and it should be modelled before the term sheet rather than conceded in it.
The contract date is the CGT event
For a standard sale, the CGT event happens when the contract is signed, not when the money arrives. A contract signed on 29 June falls into that financial year even if settlement is months later. Where you have discretion over signing, that discretion is worth using deliberately.
Earn-outs and deferred consideration
Deals structured with an earn-out, where part of the price depends on future performance, have their own tax treatment and their own timing consequences. They also delay certainty about how much you actually received, which complicates the superannuation contribution timing described above. Understand the tax treatment before agreeing to the structure.
What else is in the price
Restraint of trade payments, consultancy arrangements where you stay on, and amounts allocated to different asset classes within the sale are all taxed differently. Two deals at the same headline number can produce meaningfully different outcomes based on how the consideration is allocated. That allocation is negotiable.
Do not let the elections slip
Business sales generate an enormous amount of paperwork, and the superannuation elections are small documents in a large pile. They are also the ones with hard deadlines attached and no fix if missed. Assign someone to own them.
After: the part nobody plans for
Do nothing, deliberately, for a while
A large sum arriving at once, often alongside the loss of a daily role and identity, is a genuinely unusual psychological position. It is also when people are most exposed to poor decisions and to approaches from people who noticed the sale.
Park the proceeds somewhere safe and boring. Give yourself six to twelve months before making irreversible commitments, other than the ones with statutory deadlines. The pressure to deploy capital immediately is almost always coming from someone other than you. Our article on managing a financial windfall covers this period in more detail.
Watch what a large contribution does to your super position
A substantial CGT cap contribution can move you across thresholds that did not previously concern you.
The general transfer balance cap is $2.1 million for 2026-27, and it limits how much can move into the retirement phase. Amounts above it stay in accumulation, taxed at 15% on earnings.
Division 296 applies additional tax to earnings attributable to the portion of a total superannuation balance above $3 million, with a further tier above $10 million. An owner who contributes $1.9 million under the CGT cap on top of an existing balance may find themselves inside that regime for the first time. It is not a reason to avoid the contribution, but it is a reason to model the position rather than discover it.
Replace the income
The business was producing an income. Now a portfolio has to. That is a different discipline, and the transition is where sequencing risk does the most damage, because a poor first few years with a large balance and no other income is difficult to recover from.
Decisions about how much sits in super versus outside it, how much stays liquid, and how the portfolio is constructed all follow from what you actually need each year rather than from what looks impressive on a statement.
Revisit the arrangements built around the business
Buy-sell agreements, key person cover and business expenses policies may no longer be needed. Personal cover almost certainly still is, and your own position may have changed.
Your estate planning almost certainly needs updating. The will drafted around a trading entity you no longer own is out of date, and so are binding death benefit nominations if a large amount has just entered superannuation.
The mistakes that cost the most
Starting too late. By the time a buyer is at the table, structure and ownership periods are largely fixed.
Assuming eligibility. The basic conditions are complex, particularly for share and trust interest sales, and assuming is not the same as confirming.
Missing a clock by months. Fifteen years of ownership and turning 55 are both binary. Missing either by a short period can cost a complete exemption.
Treating the accountant and the adviser as separate projects. The tax structure and the retirement plan are the same problem viewed from two angles. Advisers working in isolation produce a worse result than the same people talking to each other.
Investing the proceeds too quickly. The urgency is almost never real.
Forgetting what the business was providing beyond money. Structure, purpose and identity all disappear at settlement, and owners who have not thought about that often struggle more than they expected.
Where we fit
We work alongside your accountant and your solicitor rather than replacing either. Our part is the personal side: whether the exit actually funds the life you want, how the proceeds should be split between superannuation and other structures, what income the portfolio needs to produce, and how the whole thing holds together once the business is no longer there.
If you are contemplating a sale in the next couple of years, the single most useful thing you can do is start the conversation now rather than after the deal is agreed. Our small business advice page has more, and we are happy to have an initial discussion at any stage.
Frequently asked questions
What are the small business CGT concessions?
There are four: the 15-year exemption, which can disregard the entire capital gain; the 50% active asset reduction; the retirement exemption, capped at $500,000 across your lifetime; and the rollover, which defers a gain where a replacement active asset is acquired. Basic conditions must be satisfied before any of them apply, and they operate in a mandated order and can be combined.
How much of my business sale can I put into super?
Amounts disregarded under the 15-year exemption and the retirement exemption can be contributed under the lifetime CGT cap, which is $1,935,000 for 2026-27, without counting against your non-concessional cap. The retirement exemption portion is limited to $500,000 within that. Your total superannuation balance does not restrict CGT cap contributions the way it restricts non-concessional contributions.
What is the 15-year exemption?
Where you have continuously owned the asset for at least 15 years and you are aged 55 or over and the sale happens in connection with your retirement, or you are permanently incapacitated, the entire capital gain can be disregarded. It is the most valuable of the four concessions, and both the ownership period and the age requirement are strict, so timing the contract can be critical.
Should I sell my business before 1 July 2027?
It depends on your circumstances, and the changes cut both ways. The general 50% CGT discount is being replaced by cost base indexation and a 30% minimum tax rate from that date, which is worse for sellers relying on it. However, the turnover threshold for the small business 50% active asset reduction rises from $2 million to $10 million from the same date, which may open that concession to businesses currently excluded. If you qualify for the 15-year exemption, neither change is decisive.
Does the contract date or settlement date matter for tax?
For a standard sale, the CGT event occurs on the contract date, not at settlement. A contract signed before 30 June falls into that financial year even if the money arrives later. Where you have discretion over when to sign, that timing is a legitimate planning lever.
What should I do with the money after selling my business?
Aside from decisions with statutory deadlines, such as superannuation contribution elections and timing, very little needs to happen immediately. Placing the proceeds somewhere secure and allowing six to twelve months before making irreversible commitments is a sound default, particularly given the combination of a large sum and a significant life change.
Do I need both an accountant and a financial adviser?
For a transaction of this size, generally yes, and they should be talking to each other. The tax structuring and the retirement planning are two views of the same problem, and the most common cause of a poor outcome is each professional optimising their own part in isolation.
General advice warning. This article contains general information only and does not take into account your objectives, financial situation or needs. It is not tax advice. The small business capital gains tax concessions are among the most complex provisions in Australian tax law, eligibility depends entirely on your specific circumstances, and specialist tax advice is essential before relying on any of them. References to measures commencing 1 July 2027 reflect our understanding of the law as at the date of publication. You should seek personal financial, taxation and legal advice before acting on any of it.
