Changing, pausing, closing or selling your business

Running a business is an incredible journey, full of growth, challenges, and eventually, change. Whether you're ready to pivot, take a break, hand over the reins, or shut things down, how you manage the transition can shape your future success and peace of mind.

Here’s a practical breakdown of the tax and administrative steps you need to follow to stay compliant with the Australian Taxation Office (ATO), no matter the path you choose.

Changing Your Business Structure or Direction

Pivoting your business can breathe new life into your operations. It might mean offering new services, targeting a different market, or rebranding completely. When you change your business structure, there are specific ATO responsibilities to tick off:

Key ATO Steps:

• Register a new Australian Business Number (ABN) if changing your structure (e.g., from sole trader to company)

• Notify the ATO of your business changes

• Transfer assets and liabilities to the new entity

• Register for applicable taxes (GST, PAYG etc.)

• Review and update employee obligations, including super and entitlements

• Lodge final tax returns for the old entity

Pausing Your Business

Need a break? That’s completely valid. Pausing your business means you're not operating, but the ATO still expects you to stay in touch.

During the Pause, You May Still Need To:

• Lodge BAS or income tax returns if required

• Pay any outstanding tax liabilities

• Fulfil employee obligations if you still have staff

• Maintain accurate financial records

• Renew business licences or registrations if required

It’s important to notify the ATO to ensure your obligations are adjusted accordingly.

Closing Your Business

Shutting down is never easy, but with the right process, you can close your business cleanly and avoid unnecessary tax problems later on.

Steps to Take:

• Notify the ATO of your intent to close

• Lodge your final income tax return and activity statements

• Pay any outstanding debts including PAYG, GST and super

• Cancel your ABN, GST and any other registrations

• Keep accurate records for at least 5 years (as required by law)

Selling Your Business

Selling can be a great outcome, whether you’re moving on to new ventures or retiring. Just don’t forget the tax implications.

ATO Responsibilities When Selling:

• Notify the ATO of the sale

• Determine Capital Gains Tax (CGT) or other applicable tax obligations

• Lodge final tax returns

• Pay any remaining tax debts

• Retain business records for the required period

Final Thoughts

Transitions are part of every business lifecycle. Whether you're changing, pausing, selling, or closing, what matters most is doing it with the right advice and full compliance. The ATO has strict requirements, and mishandling your obligations can lead to penalties, interest, or even legal action.

Need Expert Help?

If you’re unsure about the tax side of your business transition, we’re here for you. Call Dolman Bateman today on (02) 9411 5422 to speak with a qualified accountant who understands your business and the Australian tax system.

Let us help you make your next move with confidence.

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Disclaimer:

The information provided in this article is general in nature and does not constitute personal financial, legal or tax advice. While every effort has been made to ensure the accuracy of this content at the time of publication, tax laws and regulations may change, and individual circumstances vary. Dolman Bateman accepts no responsibility or liability for any loss or damage incurred as a result of acting on or relying upon any of the information contained herein. You should seek professional advice tailored to your specific situation before making any financial or tax decision.