Handing Over A Business For Free

You transfer ownership rather than sell it. In practice that means agreeing the handover in writing, transferring the shares (for a company) or the business assets, goodwill, lease and client contracts (for a sole trader or partnership), notifying the ATO and ASIC where relevant, and settling employee entitlements. Most free transfers on Biz Buy International also include a handover period where the outgoing owner trains the incoming one, because the value being passed on is the relationships and the know-how, not the equipment.

Yes. A gift or transfer for no consideration to a family member is common in Australian succession, and it is usually structured either as a transfer of shares or as a staged handover where the child takes an increasing equity share while the parent stays on. The transfer still needs the same documents as a sale, and it is still a disposal for tax purposes even though no money changes hands. Family succession also tends to need a written agreement about what happens if the child later wants to exit.

Gifting is treated as a disposal at market value, so capital gains tax can apply even though you received nothing. Small business CGT concessions, the 15-year exemption and retirement exemption often reduce or remove that liability, and stamp duty may apply in some states where land or dutiable assets are involved. GST and depreciation balancing adjustments can also come into play. This is general information, not tax advice — get a registered tax agent or accountant to model your specific position before you sign anything.

Typically a transfer or gift deed, a share transfer form and updated ASIC records for a company, or an asset transfer agreement where the business is not incorporated. You will also need consents: the landlord for the lease, key suppliers or franchisors where contracts are not assignable, and the incoming board's acceptance of the liabilities they are taking on. A non-profit recipient will usually want a due diligence period and written confirmation of employee entitlements before accepting.

Employee handovers are one of the most successful forms of free transfer, because the staff already know the customers and the systems. It can be done by transferring shares to one or more employees, by setting up an employee share scheme, or by transferring the business to an entity the employees own. The main things to settle early are how leave and long service entitlements carry across, whether personal guarantees on the lease need replacing, and how long you will stay to support the handover.

Because a business that closes is worth nothing to anyone. Health, relocation, retirement with no successor, or a shift in priorities can leave an owner with a viable business and no time to run a sale campaign. Handing it to someone who will look after the staff and the customers preserves what was built, and can cost less than winding the business up.