Considering selling your small business in Melbourne, Victoria, Australia? It’s a wise choice! Melbourne is projected to be Australia’s fastest-growing capital city in 2023-2024, with consistent population growth expected through 2030. Boasting a thriving economy that attracts investments across various sectors, a diverse culture, and abundant talent, Melbourne is the place to be. However, specific regulations are crucial for a successful sale in this vibrant city, and we at Business Brokers Melbourne are here to assist you every step of the way.
The role of Business Brokers Melbourne
Selling a business can be a complex process, requiring a thorough consideration of its legal, financial, and technical aspects. To navigate this successfully, seeking professional guidance and the expertise of a business broker is crucial. At Business Brokers Melbourne, we specialise in determining a company’s value, preparing it for sale, and effectively marketing it to potential buyers.
Moreover, business brokers offer essential services, including exit strategy development, financial assistance, and tax advice. This is particularly significant in Victoria as it is known for being the highest-taxing state, which can significantly impact your profits as a seller. Ultimately, business brokers streamline the sale process by connecting you with potential buyers and managing all legal, administrative, and negotiation aspects, ensuring a smooth and successful deal closure.
Legal preparation of a business sale in Victoria | Business Brokers Melbourne
Section 52
The Section 52 document, often referred to as the Section 52 statement, is a mandatory requirement governed by section 52 of the Estate Agents Act 1980 (Vic). In the sale of small businesses, this document serves as a disclosure agreement, which is typically made available to potential purchasers by the vendor or the vendor’s agent, commonly the business broker.
Prepared by the business broker, this statement provides a comprehensive overview of the business’s financial and tax information over the past two years. It plays a pivotal role in the sale process. If this statement is not provided to the purchaser before they sign a contract agreement or when the vendor’s agent accepts a deposit, it grants the purchaser the right to void the contract within three months of signing, provided they have not yet assumed ownership of the business. Consequently, this scenario could lead to the sale falling through, with the purchaser’s deposit and funds refunded.
Does my business need to provide a Section 52?
You are required to provide a Section 52 statement to the purchaser if the total valuation of your business, encompassing goodwill, plant, equipment, and fittings, amounts to $450,000 or less, excluding stock and intellectual property. However, there is an exception to this rule. If your business possesses an active license or permit under the Liquor Control Reform Act 1998, you are not obligated to provide this statement.
Transfer of business name
When selling your business, it’s essential to undergo the official process of transferring your business name, which is regulated by the Australian Securities & Investments Commission.
Supporting documents
Other documents that may be required for your business sale are:
- Business name registration certificate
- Australian Business Number (ABN) registration
- Australian Company Number (ACN) registration
- Goods and Services Tax (GST) registration
- Insurance papers
- Lease papers
- Market evaluation of the business
- Partnership agreement
- Buy-sell agreement
- Retirement payout agreement
- Contracts relevant to the succession
- Will and testaments
- Resumes of potential successors
Get in touch with Business Brokers
At Business Brokers Melbourne, we offer a diverse skill set and an extensive network, both of which can greatly enhance your business and facilitate a successful transaction. Our dedicated business agents are committed to guiding you through every step of your business sale. Contact us today to initiate your business sale process, and we look forward to providing our expert assistance.
