Business Succession Planning

February 2004

In the absence of a documented agreement, the voluntary or involuntary departure of a person who is a principal of the business could trigger undesirable commercial and taxation consequences, including:

  • triggering of unwanted capital gains tax liabilities;
  • an unwanted dissolution of the business;
  • a liquidity crisis because of demands for repayment of loans owing to the deceased or his or her entity;
  • an interest in the business entity being acquired by an unwanted stranger or the absence of any ready funded buyer for the ownership interest that had been controlled by the deceased.

There are various taxation and other planning issues that need to be considered when evaluating business succession arrangements. Key taxation issues include Capital Gains Tax, Income Tax, Stamp Duty, GST and FBT.

Baldwins provides novel documented arrangements to ensure a successful transition of the existing business to a new ownership structure and at the same time successfully reducing the adverse impact of taxation arising as a consequence of the death or disablement or trauma illness of a co-owner.

For further information, contact Joe Lederman at BALDWINS, Australian Lawyers & Consultants.

Return to the Wills and Estates Page or Business Succession Planning Page.