RBizz Corporate Accountants - Resources #CGT deferralRBizz Corporate Accountants - Resources #CGT deferralhttps://www.rbizz.com.au/blogs/tag/cgt-deferralMon, 24 Aug 2026 15:13:11 +1000http://zoho.com/sites/<![CDATA[The Small Business Restructure Rollover: Changing Structure Without Triggering CGT]]>https://www.rbizz.com.au/blogs/post/the-small-business-restructure-rollover-changing-structure-without-triggering-cgtThe small business restructure rollover lets eligible businesses change legal structure without an immediate CGT hit, provided the same owners retain economic ownership and the change is timed separately from any actual sale.]]>
The Small Business Restructure Rollover: Changing Structure Without Triggering CGT

The Small Business Restructure Rollover: Changing Structure Without Triggering CGT

Moving from a sole trader to a company, or restructuring between a trust and a company, would normally trigger a CGT event on the transfer of business assets — even where no genuine sale has occurred and the same people still control the business afterward. The small business restructure rollover exists specifically to remove this barrier, allowing eligible businesses to change legal structure without an immediate CGT liability.

What the Rollover Actually Allows

Where the conditions are met, assets can be transferred from one entity to another as part of a genuine restructure without triggering CGT, GST, or in some states, stamp duty on the transfer. The tax cost base of the asset carries over to the new entity, meaning the tax isn't eliminated — it's deferred until the asset is eventually disposed of outside the business, at which point CGT is calculated against the original cost base.

The Key Conditions

  • The transaction must be a genuine restructure, not a disguised sale — the same economic owners need to maintain their ownership interest in the business through the new structure.
  • Both the transferor and transferee must be eligible small business entities, or affiliated with one, meeting the relevant turnover threshold.
  • The asset must be an active asset used in carrying on the business, not merely an investment asset held incidentally.
  • The restructure must not materially change the ultimate economic ownership of the assets involved.

    • Where This Commonly Trips Up

    The "genuine restructure" test is the one businesses most often get wrong — if the restructure coincides closely with a planned sale of the business, or ownership genuinely changes as part of the process (new investors coming in, existing owners cashing out), the rollover can be denied on the basis that it wasn't a genuine restructure but effectively a disposal.

    What to Check Before Restructuring

    1. Confirm both entities meet the eligibility turnover threshold.
    2. Confirm the same people retain their economic ownership interest through the new structure.
    3. Time the restructure separately from any sale process — don't restructure and sell in the same continuous transaction.
    4. Get the rollover eligibility confirmed before transferring any assets, since this isn't something correctable after the transfer has occurred.

    RBizz reviews restructure eligibility before assets are transferred — get in touch before you change your business structure.

    Contact Us


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