Now is the time to buy a business. As part of the South Australian State Budget 2015-16, a range of taxes and duties affecting business transactions have been abolished or will be phased out.
Stamp duty on items such as non-fixed equipment, assets and intellectual property, as well as share duty, will be axed. On agreements executed after 18 June 2015 this means that stamp duty will generally no longer be payable on the sale of businesses apart from those aspects which relate to the transfer of land.
The abolition of stamp duty on commercial land sales will also be phased out over the next three years.
Furthermore, stamp duty relief will also be made available to businesses looking to undertake corporate reconstructions.
In light of this, if you are buying a business, there are now significant cost savings available from the 18th of June 2015. For an approximate calculation of what you could save, see the “Stamp Duty on Transfer of a Business Calculator” from RevenueSA here.
Another effect of the removal of stamp duty costs is that it makes it more attractive for interstate businesses to relocate to SA if your business can be located anywhere. To therefore grow and sell in a market which does not have the same stamp duty costs which buyers must pay in other states.
Since South Australia today encourages the purchase of businesses, now may be the perfect time for you to sell. In a previous blog post, ‘How to prepare a business for sale’ (http://www.tri-meridian.com/news-item/How-to-Prepare-a-Business-for-Sale-February-5-2013/), we outlined a number of key issues a business owner should consider when selling a business, ones which may be worth looking over.
Business transactions can seem daunting, although they do not have to be and here at Tri-meridian we have a great deal of experience in this area and would love to assist you in the process. When purchasing or selling a business ensure that you seek legal and financial advice on the matter. If you would like some advice about selling your business or about a potential business acquisition, please give us a call at Tri-meridian and we are more than happy to be of service.
For further information, please contact the author.
This article is posted in Adelaide, South Australia by Tri-meridian Corporate & Commercial Law and is intended to be used as a guide only. It is not, and is not intended to be, advice on any specific matter. We do not accept responsibility for any acts or omissions resulting from reliance upon the content of this article. Before acting on the basis of any material in this article, we recommend that you consult your professional adviser.