Capital Gains Tax Concessions in Succession and Estate Planning

Careful planning may now be required to avoid an undesirable
Capital Gains Tax liability.

The recent increase in rural land values and commodity prices has meant that where historically a typical family farming enterprise has been considered a small business, careful planning may now be required to avoid an undesirable capital gains tax liability.

There are capital gains tax (CGT) concessions for small business entities which can eliminate all or part of the CGT on an asset sale or transfer. To be eligible for the small business entity status, the entity needs to amalgamate the assets and income turnover for all its connected and affiliated entities before applying the tests.

Under the current legislation your business must meet 'basic conditions' for the entity to be eligible for these small business concessions. To be eligible you must satisfy one of the following tests.

1) Your business entity's aggregated turnover (income from ordinary business such as produce sales) is less than $2 million for the current or previous financial year; or

2) The maximum net assets value test - the total net value of CGT assets owned by you and certain entities does not exceed $6 million just before the CGT event. That is, the market value of the CGT assets less any liabilities which are related to those assets.

There is a strategy to take advantage of the small business entity CGT concessions in the financial year following that which you do not satisfy at least one of the tests for the first time. In this subsequent year, the CGT concessions will still apply. For example, the entities assets were above the $6 million threshold and the income turnover is above the current $2 million threshold for the first time in the 2021/22 tax year, there is an opportunity to transfer suitable assets either directly to the next generation or into a discretionary trust as part of your succession and estate plan. This could uplift the cost base of the asset in the 2022/23 tax year whilst taking advantage of the CGT concessions. If this asset was transferred or sold in the future, the CGT will be reduced as the previously low-cost base has been uplifted to market value in the 2022/23 tax year.

Succession and estate planning

A discretionary trust structure can provide some asset protection and will enable you to pass control of the trust to your successor(s) and to split any future CGT between the beneficiaries of the trust.

While transferring land to a discretionary trust may save CGT in the future, this structure may not be suitable for all situations. Before starting this process, it would be worthwhile to review your current plans and ensure they are adequate.

Act now

If you believe that your entity's business may be impacted by not satisfying one of the conditions of the small business entity test in the future, please contact us to discuss your situation and we will develop a tailored plan to meet your needs.

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Unlock The Benefits Of Downsizer Super

By Cogger Gurry • October 21, 2025

If you’re nearing retirement and looking for ways to boost your superannuation savings, downsizer super contributions might be the perfect solution for you. These allow eligible Australians aged 55 and over to contribute proceeds from selling their home into their superannuation fund. A downsizer contribution allows an eligible individual to contribute an amount equal to all or part of the sale proceeds (up to $300,000 each) from the sale of their home into their superannuation fund. The contribution must not exceed the sale proceeds of the home. The great advantage is that downsizer contributions aren’t restricted by any other contribution caps or your total superannuation balance; there are no work tests; and there’s no upper age limit. It’s one of the rare ways you can contribute large amounts to your super even after the age of 75. Eligibility To make a downsizer contribution, you must: • be 55 years or older at the time of contribution; • have owned the home for 10 years or more (the owner can be you or your spouse); • sell your home that is in Australia and is not a caravan, houseboat or mobile home; • ensure the sale is exempt or partially exempt from CGT for you under the main residence exemption; • make the contribution within 90 days of receiving the sale proceeds (usually settlement date); • not have made a downsizer contribution previously from another home; and • provide your super fund with the Downsizer contribution into super form either before or at the time of making the contribution. Failure to submit the Downsizer contribution into super form on time may result in your fund rejecting the contribution or treating it as a standard non-concessional contribution, which could have adverse tax implications. The 90-day deadline from the date of settlement is also strict. If you need more time (Eg due to delays in purchasing a new home), you must apply to the ATO for an extension. Extensions are granted only in limited circumstances, such as settlement delays due to council approvals. If you are considering selling your home and wish to further explore a potential downsizer contribution, please do not hesitate to get in contact with our office (03)55710111

Big Changes Coming To AML/CTF Laws- What Our Clients Need To Know

By Cogger Gurry • October 21, 2025

The government has announced major reforms to Australia’s Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) laws . This is the biggest update in nearly 20 years. These reforms aim to modernise how Australia combats financial crime and bring us into line with international standards. While not every business will be affected, some sectors will face new or expanded reporting and compliance obligations. Sectors likely to be impacted include: Accountants and bookkeepers Real estate agents Lawyers and conveyancers Dealers in precious metals and stones The activities you undertake, such as managing client funds, setting up companies or trusts, or handling large transactions, will determine if these new rules apply to you. AUSTRAC’s national awareness campaign will help businesses understand what’s changing and how to prepare, with guidance and tools rolling out over the next year. 👉 We’re here to help. If you’re unsure whether these reforms could affect your business, contact our team to discuss what it means for you. You can read more here - https://www.austrac.gov.au/national-reforms-awareness-campaign-launch

Vouchers And GST In Your Business

By Cogger Gurry • October 21, 2025

Vouchers and GST in your business If your business sells or buys vouchers, it’s essential to understand how to account for and report GST correctly. A voucher is a document or an electronic record that represents a right to receive goods or services. This includes physical gift cards, digital vouchers and even prepaid phone cards. When your business sells a voucher, you’re essentially providing the recipient with a promise to supply goods or services in the future, and it’s at this future point that the GST implications come into play. The ATO recognises two distinct types of vouchers. Face value vouchers Face value vouchers can be redeemed for a reasonable choice of goods and services – for example, a $50 supermarket gift card that works across all store locations. The voucher sale isn’t considered a GST taxable supply, so you don’t charge GST at the point when you sell the voucher. Instead, you account for GST when the voucher’s redeemed and the goods or services are supplied. For instance, if you sell that $50 gift card, you don’t charge GST on the gift card sale, but when the gift card’s redeemed to purchase goods worth $50, you charge GST on the supply of those goods. Non-face value vouchers Non-face value vouchers are restricted to specific goods or services – like a voucher specifically for a spa treatment, purchased for $100. With these, you account for GST (eg on the $100 price) at the time of sale, but only if the voucher is redeemable for taxable supplies. If the voucher is only redeemable for GST-free or input-taxed supplies, there’s no GST to account for. Note on expired vouchers Here’s something business owners often overlook: if you’ve sold face value vouchers that expire or remain unredeemed, and you write back the unused amount to your current income for accounting purposes, you need to make an “increasing adjustment” on your Business Activity Statement (BAS). This adjustment is 1/11th of the unredeemed balance. Keep accurate records To account for GST on vouchers you sell, you need to keep accurate records including dates of sale, redemption and/or expiration, and the amounts of GST payable. Importantly, specific rules and exceptions apply to certain types of vouchers. For example, if you sell vouchers that can be redeemed for a combination of goods and services, you need to apportion the GST accordingly. You may also need to issue a tax invoice to the customer when a voucher’s redeemed and \keep a copy of this invoice for your records. And finally, of course, you need to report GST on vouchers in your BAS in accordance with ATO guidelines.