Sale Negotiation and Agreement Structuring

So you have done the hard work …

  • Your business is as ready as it will ever be
  • You know the tax consequences and
  • How you will minimise the tax impact, and
  • You now have an interested party who can see what you have built and want to take it off your hands …

But, one purchase price is not necessarily equal to another, even if the headline figures aren’t far apart.

Agreement terms can vary widely, and each one, even those that seem minor or innocuous at first, could have a big impact, including on the tax outcome! Examples include –

  • Your ongoing commitments to the purchaser
  • Your restraint of trade
  • The allocation of the purchase price between Stock, Plant and Goodwill
  • Any earn-out or delayed purchase price.

These are all examples of agreement terms, amongst many others, that can have a significant bearing on the commercial and personal success of a deal irrespective of the price on offer.

Don’t be fooled by the old “they are all just standard clauses” routine. Even if that is the case, it doesn’t necessarily mean you have to agree to them. Or at the least, you need to understand the commercial reality they bring.

Remember, while your business broker is certainly on your side looking to get you the maximum sale price, they only get paid when a sale goes through, so it may not always be in their best interests to advise you to push back and secure better terms. Plus they cannot legally advise you o the tax consequences of any agreement the put in front of you.

That’s just one reason why it so often pays to have a separate, totally independent, Adviser helping you to get the very best (overall) result.

Accounting & Tax

What our customers say

My worst nightmare was an ATO audit… when it happened, Tom and the Team resolved all the issues painlessly

I recently received the dreaded notice from the ATO that my business affairs were to be reviewed (a nice way of saying audited). As you can imagine I was immediately pretty stressed and anxious as to what would be involved and what the outcome could be. But CapitalQ handled the whole process so efficiently and professionally, they were able to answer all of the ATO questions and requests for information in a manner that meant further questions and requests for information were not required. This meant that the ATO quickly felt comfortable with what was presented to them and that I was doing all the right things and that there was nothing to be gained by digging further (which there wasn’t, but still, you don’t want them digging further if you can avoid it).

Burak

Personal and Business details withheld for commercial confidentiality reasons

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