Selling your small business: what a lawyer actually does
Selling a small business has many legal moving parts. Here's what a succession lawyer actually does in the process.
A succession lawyer in a small business sale handles the transaction documents (sale agreement, asset transfer instruments, restraints, employment contract assignments), coordinates with the accountant on tax structure (small business CGT concessions, replacement asset rollovers), and ensures the seller’s estate planning aligns with the post-sale position.
Pre-sale preparation
Clean up the entity structure (parent/sub, holding company arrangements). Update the constitution and shareholder agreement. Resolve outstanding shareholder issues. Tidy intellectual property ownership. Address any unresolved tax positions. 12 months of preparation typically adds significant value to a sale.
Sale documents
Sale agreement (asset sale or share sale – very different legal and tax outcomes). Restraint of trade (typically 3-5 years, defined geographic area). Earn-out provisions (where part of the price is contingent). Warranties and indemnities (what the seller stands behind). Tax warranties.
Tax coordination
Small business CGT concessions can save substantial tax for qualifying small business owners. Eligibility depends on the entity structure, the seller’s connected entities, and meeting specific tests. Sam coordinates closely with your accountant on the tax structure.
Estate plan update
A sale often turns business assets into investment portfolio, super contributions, and cash. The estate plan should be updated to reflect the new asset profile – typically simpler than the pre-sale plan but with new questions about how to leave the proceeds.
Summary
Selling a small business has many legal moving parts. Here’s what a succession lawyer actually does in the process.
Talk to Sam about your situation
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Related reading
- Business succession planning in Australia
- Strategic corporate restructuring for small business
- Strategic restructuring
Disclaimer: This article is general information only and does not constitute legal advice. Estate planning is deeply personal - every family's circumstances are different. For advice specific to your situation, please contact Rosewood Succession Solicitors.