How to Sell a Business in Australia

Selling a business is not like selling a property. There’s no standard form, no set settlement period, and no template that fits every situation. The process can take 12 to 24 months from the moment you decide to sell — and the decisions you make along the way have a direct impact on how much you walk away with.
Most business owners only do this once. That’s not enough practice runs to get it right without help.
This guide covers every stage of the process: how to value the business, what the tax implications look like, how to structure the deal, and what separates a good exit from a great one. If you’re ready to talk through your specific situation, our Selling a Business page covers exactly how we work with sellers.

Is Now the Right Time to Sell?

Before anything else, you need to be honest about timing. Not just market timing — personal readiness matters just as much.
From a market perspective, the best time to sell is when the business is performing well and showing an upward trend. Buyers pay for future earnings. A business coming off three strong years will attract a better multiple than one recovering from a flat period — even if the underlying asset is identical.
From a personal perspective, the best time to sell is before you’re ready to leave. Counterintuitive, but true. Owners who rush to exit because they’re burned out, dealing with health issues, or facing a change in circumstance are negotiating from a weak position. Buyers can smell urgency.
The sweet spot is a planned exit: decide 2–3 years out, start preparing early, and go to market on your terms. That’s the kind of strategic planning our business advisory team helps business owners work through well before a sale is imminent.
The business owners who achieve the best outcomes are those who start the conversation early. Not at the point of signing.

What Is Your Business Actually Worth?

This is the question that drives everything else in the sale process. Get the valuation wrong and you either leave money on the table or price yourself out of a deal.
There are three main methods used to value Australian SMEs. For a full breakdown of each, see our dedicated Business Valuation guide.

EBITDA multiple — the most common approach

EBITDA stands for Earnings Before Interest, Tax, Depreciation and Amortisation. It’s a proxy for the operating cash your business generates. A multiple is applied based on the industry, the growth profile, and the risk characteristics of the business.
Multiples for Australian SMEs typically range from 2x to 6x EBITDA. A business generating $500,000 in EBITDA in a sector trading at a 3.5x multiple would be valued at approximately $1.75 million.
The multiple is where value is really negotiated. Understanding what drives multiples in your sector — and what you can do to improve yours before you go to market — is one of the most valuable things a good advisor does.

Asset-based valuation

Some businesses are valued primarily on what they own rather than what they earn. Property, plant, equipment, client lists, and goodwill are all components. This method is more common in asset-heavy businesses like manufacturing or logistics, and in situations where earnings are low but the balance sheet is strong.

Comparable sales

Where market data is available, comparable transactions provide a cross-check on the earnings multiple approach. What have similar businesses in similar sectors sold for recently? This brings a market-based reality test to the number.

Normalisation — why it matters

Raw financial statements rarely reflect the true earnings of a business. Owner wages below market rate, personal expenses run through the business, one-off items, and related-party transactions all distort the picture.
Normalisation adjusts the earnings to reflect what the business would actually generate under arm’s-length, ongoing operation. This is the number that drives valuation — and it’s almost always different from what the P&L shows at face value. Getting your books in order well before a sale is part of what good cash flow management looks like in practice.

Getting the Business Ready to Sell

The businesses that sell for the best prices are the ones that look clean, simple, and low-risk from the buyer’s perspective. That doesn’t happen overnight. It takes preparation.

Clean up the financials

Three years of clear, well-organised financial statements are the minimum. Any personal expenses running through the business need to come out. Unusual one-off items need to be identified and explained. If your books are a mess, fix them before a buyer sees them. A virtual CFO engagement in the 12–24 months before a sale can make a significant difference to how your financials look to a buyer.

Reduce key person dependence

If the business relies on you to function, that’s a risk factor. Buyers discount for key person risk — or walk away from it entirely. The goal is to demonstrate that the business can operate and generate revenue without the current owner.
This means documented processes, trained staff who can handle day-to-day operations, and ideally some evidence of a successful handover.

Diversify your client base

A single client representing 30% or more of revenue is a red flag. Buyers worry that client will leave when ownership changes. If you have concentration risk, work on reducing it before you go to market.

Document your processes

Buyers want to see that the business is a system, not a person. Documented procedures, clear organisational structure, and an operating model that can be transferred give buyers confidence that they’re buying a going concern — not just a revenue stream that walks out the door.
Two years of preparation. One year to transact. That’s the realistic timeline for a premium outcome.

Asset Sale vs Share Sale — The Decision That Changes Everything

This is one of the most consequential decisions in any business sale. It affects both the price and the tax outcome. It also has significant implications for asset protection — both for you as the seller and for the buyer.

Asset sale

In an asset sale, the buyer purchases the specific assets and contracts of the business — equipment, client agreements, IP, goodwill — rather than the legal entity itself. The company or trust remains with the seller.
Buyers often prefer an asset sale because they get clean liability protection. They’re not inheriting the history of your entity. For you as the seller, an asset sale typically means more complexity at settlement and potentially a higher CGT bill, depending on how the assets are held.

Share sale

In a share sale, the buyer purchases the shares in your company. They take on the entity as-is — including its history, liabilities, and tax position.
Share sales can be simpler for the seller and may create more favourable CGT outcomes — particularly if you’re eligible for the small business CGT concessions (see below). The right choice depends on your structure, your tax position, and what the buyer wants. Model both scenarios before you go to market. The difference in after-tax proceeds can be significant.

Tax Strategy — CGT and the Small Business Concessions

For many business owners, the capital gains tax on a business sale is the single largest tax event of their financial life. This is squarely in the territory of business tax planning — and getting the strategy right before you sell, not after, is essential.
The Australian tax system offers four major CGT concessions for eligible small business owners:

1. The 15-year exemption

If you’ve owned an active asset continuously for 15 years and are aged 55 or older (or are permanently incapacitated), you may be entitled to a full CGT exemption on the sale. This is the most generous concession available and completely eliminates the capital gain.

2. The 50% active asset reduction

If your business qualifies as a small business entity (broadly, aggregated annual turnover under $2 million, or net assets under $6 million), you may be able to reduce your capital gain by 50% using the active asset reduction. This can be used in addition to the general 50% CGT discount for assets held over 12 months, potentially reducing a capital gain by up to 75%.

3. The retirement exemption

Up to $500,000 of capital gains from the sale of active business assets can be excluded from assessable income under the retirement exemption — either rolled into superannuation or accessed directly if you’re 55 or older. If you’re considering contributing proceeds into an SMSF, this is a conversation to have with your advisor well before settlement.

4. The rollover

If you’re selling one business and acquiring a replacement active asset, you may be able to defer the capital gain under the rollover concession. These concessions interact with each other and with your broader tax position. Eligibility criteria are specific. Using them correctly requires structuring the transaction well before settlement.
For eligible business owners, the small business CGT concessions can dramatically reduce — or in some cases eliminate — the tax on a sale. This is not territory to navigate without advice.

Finding a Buyer

Once the business is prepared and you have a clear picture of value and tax strategy, the next step is finding a buyer. If you’re also considering acquiring a business yourself, our guide on how to buy a business covers the buyer’s perspective in full.

Business broker

A business broker manages the sale process — preparing the information memorandum, identifying buyers, qualifying interest, and managing negotiations. Their fee is typically a percentage of the sale price. They work for you (the seller), so their incentive is to achieve the best price. A broker’s value is their buyer network and experience managing the process.

Direct approach

Some sellers prefer to approach potential buyers directly — competitors, industry contacts, or strategic buyers who could benefit from the acquisition. This approach can work well when you know exactly who the likely buyers are. It saves on broker fees but requires more of your time and carries confidentiality risk.

Online platforms

Platforms like Seek Business and Business Sale Australia list businesses publicly. These work well for smaller businesses and attract buyers who are actively searching. For larger or more complex businesses, a managed process through a broker is usually more effective.
Note: your accountant and your broker serve different functions. The broker manages the process. Your accountant protects your financial interests throughout it. You need both.

Preparing for Due Diligence

Every serious buyer will conduct due diligence. The smoother it runs, the lower the risk of price re-negotiation or the deal falling over entirely.
A sell-side due diligence pack typically includes three years of financial statements, BAS records, payroll records, a clean asset register, key contracts, any pending legal matters, and employee agreements. Download our Selling Your Business Checklist for the full preparation list, and our Due Diligence Checklist for what buyers will ask for.
Buyers’ accountants will normalise your earnings, check for undisclosed liabilities, and probe any numbers that don’t add up. Surprises in due diligence give buyers leverage to renegotiate. Anticipating their questions — and having clean answers ready — keeps you in control.

Heads of Agreement and Settlement

Once the key commercial terms are agreed, they’re recorded in a Heads of Agreement before the formal sale agreement is drafted. Key elements to nail:

• Sale price — and how it’s calculated (including any adjustments for working capital, stock, or WIP)
• Structure — asset sale or share sale
• Settlement timeline and conditions
• Transition and handover arrangements
• Any earn-out provisions — additional payments tied to post-sale performance
• Restraint of trade provisions — what you can and can’t do after settlement

The devil is in the details here. Price adjustments at settlement are common and can move the final number meaningfully in either direction. Make sure your accountant reviews the completion accounts and adjustments before you sign anything.

After Settlement: What Happens Next

Settlement day is not the end of the process. The CGT on your sale will be assessed in the income year in which settlement occurs. If you’ve been planning the tax position with your accountant, this shouldn’t come as a surprise. Personal tax planning in the year of settlement — including any superannuation contributions or other actions — needs to happen before year-end.
On the personal side, the capital proceeds from a business sale can form a significant part of your retirement assets. We work alongside your financial planner to make sure the transition is structured properly. If you’re considering an SMSF as part of your retirement strategy post-sale, that planning ideally starts before settlement, not after.
If there’s an earn-out arrangement, you’ll also need to track the performance metrics carefully and understand how the future payments are taxed.

The Selling Process — End to End

1. Initial advisory — assess where the business is now, where it needs to be, and what the realistic timeline looks like
2. Valuation — establish a realistic sale price and identify value improvement opportunities
3. Exit preparation — clean up financials, reduce key person risk, document processes
4. Tax strategy — model the CGT position, assess concession eligibility, structure accordingly
5. Go to market — engage a broker or approach buyers directly, with clean financials and a prepared data room
6. Due diligence — manage the buyer’s process from your side, anticipate questions, protect your negotiating position
7. Heads of Agreement — lock in the commercial terms before the formal agreement is drafted
8. Settlement — review final completion accounts, confirm adjustments, execute the transaction
9. Post-sale — manage tax obligations, earn-out tracking if applicable, personal financial transition

Common Questions About Selling a Business

How long does it take to sell a business?

A realistic timeline for a well-prepared business is 9–18 months from the decision to sell through to settlement. Rushed sales — where preparation is skipped and buyers are approached before the business is ready — typically take longer and achieve worse outcomes.

What tax will I pay when I sell?

It depends on your structure, the length of ownership, and whether you qualify for small business CGT concessions. For eligible owners, the effective tax rate on a business sale can be dramatically reduced — in some cases to zero. Our business tax planning team models the answer for your specific situation before you commit to anything.

Do I need a business broker?

Not necessarily, but they add value in most situations. Your accountant’s role is different — independent financial and tax advice throughout the transaction. Both serve different functions and complement each other.

Can creditte help me if I’m outside Queensland?

Yes. We work with sellers across Australia. Everything is done remotely. Location is not a limitation. See our full overview on the buying and selling hub.
Ready to plan your exit?
Book a discovery call. We’ll review your situation, provide a roadmap for a realistic picture of your business’s value, and tell you exactly what preparation entails.
Or explore our Selling a Business service page and Business Valuation page for more detail.