If you’re thinking about selling a business, it’s easy to fixate on the contract price – and yes, it is important because it’s the headline figure. But the figure that actually matters is the amount that lands in your pocket after everything is wrapped up: your post-sale proceeds.

Two similar deals with the same contract price can deliver very different outcomes for the respective owners once you factor in costs and tax. Understanding these costs and knowing your post sale-position is essential before starting the sale process. [In larger deals the way that the deal and payments are structured can also have implications so get specialist advice early].

In this article I’ll show you a simple exercise so you can stop fixating on the sticker price and start planning your real take-home.

 

the three numbers that drive your post-sale proceeds

 

1. proceeds from the business sale

This starts with the agreed sale price, but the amount you walk away with comes after you finalise your obligations, this includes your:

  • transaction costs from solicitors, accountants + selling fees,
  • paying off any liabilities like loans, creditors + staff entitlements, and collecting any money owed to you.

 

2. your tax position

There will often be tax implications from the sale. Depending on how your business is structured [company, trust or sole trader] and the length of time you have operated the business can have a significant impact on any tax applicable on the sale. The same headline price can deliver very different after-tax outcomes depending on structure and timing.

This is why focusing only on the contract price can be risky, and it is critical that you get specialist advice before signing a contract.

 

3. estate + wealth planning

If your sale is part of a retirement or succession plan, the strategy for your proceeds is just as important as the deal itself. Getting specialist wealth advice in this scenario can be invaluable.

It’s only when these three factors are combined that you get a true picture of your post-sale outcome.

 

so, what can you do right now?

 

Before you get too far into the sale process, run a “what-if” scenario:

  1. Write down your expected sale price.
  2. Subtract estimated liabilities and transaction costs.
  3. Get your accountant to estimate your potential tax on the sale.
  4. What’s left is your realistic post-sale amount and that’s the number to plan around.

Even a simple calculation like this can shift your focus from the headline price to the net result that truly matters – the number that funds your next chapter.

 

the key is to know your numbers as early as possible

 

Engage specialist advisers who understand business sale transactions [particularly the tax implications] well before you sign a contract.

This preparation allows you to:

  • understand the real financial result after the sale,
  • plan how to manage and invest those funds, and
  • position yourself for the best long-term outcome.

 

we’re here to help

If you’re thinking about selling a business, we can help you bring the right people to the table across tax and legal, business sales advisory and wealth advisory to help you prepare and navigate the process from start to finish.

If you want to sense-check your numbers get in touch with me on 0417 886 352 for a confidential discussion.

This is general advice only and it is essential that you seek professional advice regarding your specific circumstances before making any decisions.

 

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