SMALL BUSINESS CGT CONCESSIONS EXPLAINED

[@johntaylor6300]

Your videos are great! Well produced and good info..

[@DavieMach]

Thanks mate !

[@DreamFirms]

Learned a lot!

[@DavieMach]

Cheers Tyler

[@ArusheeSharma]

Hi amazing video! I have a question, if a 55 year old sole proprietor plans to sell their business (13 years old business), not purchased but started from scratch. Can he get the 500K exemption?

[@Ressy66]

Great info thanks Davie, one question though, what if the small business is a pty ltd company with the only the owner and no other directors or shareholders, and wants to sell the company as a whole (think small webhost company), I think that is the companies money if I keep the company entity and sell everything, because I am selling whats inside only and I hold the name and bank etc etc? but what if my sale is for the whole lot, the inside and legal entity? Be awesome if you did a video explaining that, since I'm unsure if that would be "personal" or still treated as company ;)

[@CC-wk3iy]

Great video Davie. Is there anyway to get an extension on the 2 years?

[@DavieMach]

For the replacement asset? Unfortunately no

[@CC-wk3iy]

@@DavieMach thank you for confirming. Is it possible to purchase a property to rent out ?

[@DavieMach]

@@CC-wk3iy has to be a business asset. Unlikely to be able to do that unless it’s a motel/hotel (as that’s a business)

[@johnkinchin5999]

Thanks Davie. Great Video presentation. One question I do have is with the "business turnover of less than $2M a year and net assets less than $6M" is this for the entire business or your portion. EG if I have a 25% interest in a business turning over $7M a year, looking to sell for $6M am I excluded from this or is my turnover consideration 25% of the $7M (i.e. $1,750,000) turnover, and net assets 25% of $6M (i.e. $1,5M) a in which case I would qualify?

[@DavieMach]

Firstly, do not take the below as tax advice. Its best to go speak to a tax expert and get paid tax advice. its 2m turnover on the business (not your portion). the net assets test is on you and your affiliates. So applying your examples, you wont meet the turnover test as it is over $2m. net assets is based on you, connected entities and your affiliates. I think the business isnt controlled by you as you dont own 40% or more. If it is then you may have to include the total value of the business (6m). You may qualify but you need to be careful as if you need to be considered a concessional stakeholder/significant individual. Best to speak to a tax expert in this situation. We can help - just contact us.

[@tysont2380]

Not related but. Do you how retail entitlement offers effect cgt on shares

[@DavieMach]

Hi, it’s best to seek professional advice as a range of variables can affect the end result here.

[@gunhound45]

Im a bit confused at the tax at 1:57, arent companies taxed at 25%? Or are we assuming he is a sole trader and thus taxed at the personal rate?

[@DavieMach]

Yes in this example we used a individual selling their business.

[@masterbjohnson2]

The individual owns the asset, not the company

[@manamifox2405]

Wow! Great video. I want to buy shares on listed companies. We are a family of 4, me, my husband and two small kids. Let's say we don't want to increase our tax bracket. In this case, what's the best structure to buy listed shares? If we have a discretionary family trust with a corporate trustee, then can I use this structure to buy shares to use both of 50% CGT discount and small business 50% active asset reduction for capital gain from sale of shares in listed companies? Or even not paying CGT at all to put the rest into our superannuation fund?

[@DavieMach]

Hi Manami, thanks for watching! Unfortunately, it's tough to gauge your best options without more context since a huge range of factors could affect your situation. I'd consult a professional before deciding on a structure so that you don't miss any potential details that'll affect your decision.

[@manamifox2405]

@@DavieMach Thanks for your reply.

[@ianyapxw]

Hey Manami have you figured out the best corporate structure to do what you listed above? My wife and I are in a similar position and wondering if there's a way we can get 50% + 50% off by buying, holding then selling listed shares.

[@JaneParkerBowls]

If u r passively investing in a trust, you wouldn’t be able to get any of the concessions right?

[@DavieMach]

Most likely It’s more for small business owners

[@tysont2380]

As an account how often do you have to look up legislation?

[@DavieMach]

If you are referring to small business cgt concessions, I literally review it every time I apply for small business cgt concessions!

[@tysont2380]

@@DavieMach do you have any tips on reviewing legislation. Where exactly do you go to review legislation

[@ianyapxw]

@@tysont2380 I'm guessing it's possible to see changes, precedent, etc... through newsletters, press releases, etc... Big accounts/law firms have entire teams of assistants reviewing all these for them every day.