In March 2016, the Tax Laws Amendment (Small Business Restructure Roll-over) Act 2016 received royal assent.

So, what does this mean?

If you are a small business, that is, your turnover is less than two million dollars ($2,000,000.00) annually you may meet the eligibility requirements to change the legal structure of your business and defer capital tax gains or losses, which would have otherwise realised when transferring business assets from one entity to another.

In addition to the turnover limit you must also satisfy the maximum net asset value test, which is the value of your entities CGT assets must be less than six million dollars ($6,000,000.00).

If you meet the above two requirements you should get in contact with us to discuss whether you will be eligible for this roll-over relief.

Why should you restructure?

An evolving business can often find its current structure out of date and inflexible, the ability to identify and take advantage of the opportunity to re-structure without triggering unnecessary taxes or other costs can be quite challenging, so why not take advantage of this opportunity. There are a number of reasons why you may want to restructure your small business, including:

  1. Asset protection (protect your personal assets):

Having the right business structure is essential for protecting your assets against unforeseeable circumstances or losses that is, creating a barrier against potential litigation or from losing control of your business.

Have you considered whether your family home is protected, do you run your business and have you family home is your name? It may not be as safe as you think.

The nature of and the way income and tax is treated (don’t pay unnecessary tax):

Do you have the most efficient and tax flexible structure? Having the right structure can minimise ongoing costs, utilise interaction of other entities and ensure flexibility and tax effectiveness.

There is no one structure that is right for each business; it may be a combination of structures which work for you.

If you would like to take advantage of this roll-over relief or discuss your current structure get in contact with us on (07) 5444 1022 or email to make an appointment.