Similar to purchasing a home, buying a business can have various additional costs which the buyer should factor in. The biggest cost involved is often the transfer duty (also called stamp duty), which in Queensland will apply when purchasing business assets.
In Queensland, transfer duty can apply in the value of the business assets being purchased. Business assets encompass all aspects of the business, ranging from physical items such as stock, motor vehicle and equipment to intangible assets such as the business name, goodwill or the business trademarks.
The transfer duty payable will be calculated based on either the total value of the assets being purchased or the purchase price, whichever is higher. This would mean that transferring a business asset to a family member or a related party at minimal or no purchase price may still require the recipient to pay transfer duty.
As with all things tax, exceptions or concessions may apply. These include when a business property, that is used in the primary production business is transferred to family members or in specific instances of a restructure for small businesses. Additionally, purchasing shares in a company is different from purchasing business assets; and the purchase price will generally not incur transfer duty.
Navigating the requirements around transfer duty as well as all other requirements in a business transaction can be complex. Contact our Commercial team on 1300 285 888 to book an appointment today.
