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Small business CGT concessions: The SBE and $6m net asset value basic conditions


The small business capital gains tax (CGT) concessions are critical upon small businesses selling assets such as goodwill and real property as well as business restructuring. This article examines the alternative small business entity (SBE) and $6m net asset value basic conditions that small businesses need to be met to access the small business CGT concessions. While this article finds that the alternative SBE test and net asset value basic conditions clearly allow the vast majority of small businesses to potentially access the four small business CGT concessions, there are a number of other factors that work to limit its practical scope, such as further restrictive conditions and the high level of complexity.

Many small business owners appear to be ignorant of the CGT implications of their decisions when they commence operations and as they grow their businesses. Tax practitioners and administrators need to understand these complex rules and work closely with small business. In particular, tax practitioners will need to be proactive in dealing with their clients to ensure eligibility and to maximise the four CGT concessions.

Author profile

Dr Paul Kenny CTA
Paul is Associate Professor in Taxation Law, Flinders Business School, Flinders University, South Australia. - Current at 30 September 2015
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