Small business capital gains tax (CGT) contributions
Convert business capital into retirement savings.
How does it work?
When selling 'active business assets', you may be eligible to claim certain capital gains tax (CGT) concessions and get more money into super.
Active business assets are those held or used in your business or a business of someone connected with you. Generally, they include land and buildings and, in limited cases, shares in a company.
May be suitable if…
You're selling small business assets.
What are the benefits?
- Convert business capital into tax-effective retirement savings.
- Potentially pay less tax on the sale of business assets, as CGT concessions may be available.
Case study
Jane, aged 64, recently sold a business she has owned for the last 10 years for $500,000. She has made a capital gain of $400,000 and plans to retire.
Her registered tax agent works out she is eligible for various CGT concessions that mean she won’t have to pay tax on the sale proceeds.
Also, she’s eligible to contribute the entire $500,000 into super using a combination of the CGT cap and non-concessional contributions cap.
This money can then be used to start a retirement income stream, where no tax will be payable on investment earnings or the income payments she receives to help fund her retirement.
Important things to consider
- The small business CGT concessions are complex. A registered tax agent can help assess your eligibility and maximise the benefits.
- You can’t access your super until you meet a condition of release such as reaching preservation age and retiring.
Got a question?
Get set in the right direction with help and guidance available over the phone, online or face-to-face.
General advice and information only
Any advice and information on this website is general only, and has been prepared without taking into account your particular circumstances and needs. Before acting on any advice on this website you should assess or seek advice on whether it is appropriate for your needs, financial situation and investment objectives.
Tax disclaimer
Any general tax information on this website is intended as a guide only and is based on our general understanding of taxation laws. It is not intended to be a substitute for specialised taxation advice or an assessment of your liabilities, obligations or claim entitlements that arise, or could arise, under taxation law, and we recommend you consult with a registered tax agent.
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