Many business owners heading towards retirement are unaware they are entitled to contribute extra amounts into superannuation when selling their business, accounting and advisory firm William Buck said.
Director of the firm Anna Carrabs said many business owners do make use of super tax benefits because it is too late by the time they find out about them.
She said 70 per cent of business owners who meet the capital gains tax (CGT) small business concessions do not know they can put tax free funds into their super account when they sell a business. This includes those businesses that are pre-CGT (acquired/started before 19 September 1985).
"Eligible individual business owners may be entitled to place up to $1.355 million into a super fund tax free when this business transaction occurs, while joint couple owners can deposit up to $2.71 million," Carrabs said.
"It is imperative that planning is undertaken well before the sale occurs to ensure maximum contributions to super can be made."
Super contributions from a business sale using CGT small business concessions must be made before age 75 and within certain periods.
Contributions under one of these concessions must be made 30 days after the capital proceeds are deposited or when the tax return is lodged the year the business is sold.
"Business owners should seek advice from a super expert who understands their personal circumstances to gain the greatest financial advantage when selling a business."
