If you qualify for the Small Business 50% Active Asset Reduction, as the name suggests you may be able to reduce any gain on the sale of your business by 50%. To determine whether or not your business sale would qualify for the Active Asset Reduction the Active Asset Test must be passed, per Section 152 - 35 Income Tax Assessment Act 1997 (ITAA 1997). Some of the requirements include:

1. Ownership period;

2. Ownership of the actual business been sold; and

3. The asset must be active, i.e., used in carrying on a business.

For other Small Business Tax Concessions refer http://mcnamaraandco.com/news/2012/12/how-can-i-minimise-my-tax-liability-when-selling-my-business/  

If you would like to discuss further please contact us:
McNamara and Co - Chartered Accountants, located minutes from the Melbourne CBD
www.mcnamaraandcompany.com.au/contact-us
Phone +61 3 9428 1062
Email admin@mcnamaraandco.com

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