Quick answer
How much you get from selling your business is the headline price less broker commission, legal costs, debts that must be paid out, employee leave the contract passes back to you, any retention the buyer holds, and a tax reserve. On a typical small-business sale those items can take a large slice, so plan on the net figure, not the offer, and on the dates each part lands.
Key points
- The offer is a headline: the cash you can spend is the price less costs, payouts, staff leave, retention and tax
- Broker commission is usually charged on the business value, so check in writing whether stock at valuation is excluded
- Accrued employee leave either passes to the buyer or is paid out by you, and the Fair Work rules override the contract
- The CGT event happens when you sign the contract, but the tax is assessed later, so hold a reserve
- A lender sizing a bridge will test the net figure, so build the table before you commit to the next purchase
A buyer has offered a price you can live with. Before you spend any of it in your head, sketch the span: the offer sits at one end, and the money you can actually use sits at the other. Several deductions stand in between, and each one lands on its own date.
This guide takes the offer down to the net number the way a surveyor would, line by line, and shows the slow case. Then it covers what to do if your next move needs cash before the proceeds arrive.
What comes off the price of a business sale?
Think of the headline price as gross load. Before it reaches you, expect these items to be taken out or held back:
| Item | When it lands | Who sets it |
|---|---|---|
| Broker commission and fees | Completion | Listing agreement |
| Legal and accounting costs | Through the sale, final invoice at completion | Your advisers |
| Loans and leases secured on the business | Completion (payout figure) | Your lenders |
| Employee leave and entitlements | Completion, adjusted in the price | Fair Work rules and the contract |
| Stock, rent and deposit adjustments | Completion | Sale contract |
| Retention or deferred payment | 6 to 24 months later | Sale contract |
| Capital gains tax | Next tax return | ATO and your accountant |
None of these is a surprise to an experienced adviser. They are a surprise to the owner who has quietly promised the headline number to a landlord, a builder or a vendor on the next purchase.
How much does a business broker take?
Broker commission is usually the largest single deduction. One Australian marketplace guide gives a range of 5% to 12% of the sale price, with smaller deals often sitting at the higher end. Broker publishers also describe a minimum success fee, commonly $15,000 to $20,000, which on a smaller sale pushes the effective figure up. A $25,000 minimum on a $200,000 sale, for instance, works out to 12.5%.
Two things to check in the engagement letter before you sign:
- What it’s calculated on. Commission is commonly charged on the business value (goodwill plus plant and equipment), with stock at valuation excluded. That isn’t automatic, so get it in the contract.
- When it’s earned. Brokers are normally paid on completion, not on exchange. Ask what happens if the buyer defaults after exchange, so you know the cost of a slow case.
What about debts and finance on the business?
Anything secured over the assets being sold has to be cleared or transferred. That means equipment finance, vehicle leases, an overdraft and a loan secured against the business. Ask each lender for a payout figure that includes early termination or break costs, and the date to which that figure is valid. A payout quoted on day 20 isn’t the number on day 60.
Unsecured creditors and trade suppliers are a separate matter, as the sale contract usually determines who takes on which liabilities. If the buyer is taking over supplier accounts, make sure the agreement says so and that the price reflects it.
What happens to employees’ leave?
If you employ staff, this is the deduction owners miss. The Fair Work Ombudsman explains that when a business changes hands, employee entitlements on a transfer of business depend on whether the buyer recognises the employees’ service. If it does, accrued annual leave carries over to the new employer. If it doesn’t, the old employer pays it out. Either way the cost is a real number that comes out of the deal, because a buyer who inherits leave will take it off the price.
Practical steps:
- Run a leave and entitlements report from payroll for every employee, and update it close to completion.
- Ask your lawyer which of the two outcomes the contract produces and what the price adjustment will be.
- Remember that the Fair Work rules sit above the sale contract, so a clause that says otherwise won’t change what the employee is owed.
What are the stock, rent and deposit adjustments?
At completion the accountants usually reconcile a few moving items:
- Stock at valuation (SAV). The buyer pays for stock on hand on the day, counted by both sides. A quiet week before a count means a lower figure.
- Prepaid rent and outgoings. Whoever has prepaid gets credit for the unexpired time.
- Security deposits and bonds. Landlord bonds, utility deposits and gift card liabilities are either transferred or refunded and adjusted.
These adjustments can move the number by thousands in either direction, so don’t treat a rounded estimate as a commitment.
Will the buyer hold some of the price back?
Often. A retention is part of the price held back at completion to cover warranty claims and released after an agreed period. Another form is deferred consideration, paid in instalments or tied to performance. Both mean the cash at completion is smaller than the contract price. We cover how that works in our guide to a retention from the sale price. Plan any repayment of a bridge against the completion cash only, and treat the later payment as a bonus.
How much tax will I pay on the sale?
The ATO says that where there’s a contract of sale, the CGT event happens when you enter into the contract, not at settlement. The gain lands in that income year, and the tax is assessed with your return. So the tax bill can arrive many months after the money, and the money can already be committed by then.
The small business CGT concessions may reduce, defer or remove the gain if you meet the basic conditions (a turnover test of under $2m or a net asset test of $6m, plus the active asset test). Which ones apply, and in what order, depends on your structure and age, so get a figure from your accountant before you rely on a zero. Our guide to CGT on business premises goes through the detail, including the changes the government announced from 1 July 2027.
A sensible rule: park a tax reserve in a separate account on the day the money arrives, sized by your accountant, and don’t count it as spendable.
What does it look like in numbers?
Here’s an illustrative example. It isn’t a real deal, and your figures will differ.
| Line | Amount |
|---|---|
| Goodwill and plant | $850,000 |
| Stock at valuation | $60,000 |
| Headline price | $910,000 |
| Broker commission (on $850,000) | -$68,000 |
| Legal and accounting | -$9,000 |
| Equipment finance payout | -$42,000 |
| Staff leave passed back in the price | -$38,000 |
| Rent and deposit adjustments | -$4,000 |
| Cash at completion | $749,000 |
| Retention held for 12 months | -$50,000 |
| Paid on completion day | $699,000 |
| CGT reserve (accountant’s estimate) | -$60,000 |
| Spendable | $639,000 |
About 70 cents of each headline dollar is spendable. The retention comes back later and the tax reserve may shrink, but neither is available for the next purchase today.
Now the slow case. If the equipment lender’s payout figure expires and is reissued higher, the leave report grows because completion slips a month, and stock is counted lower, the completion cash can drop by tens of thousands. Plan on a buffer of that size, not on the best day.
What if your next move needs cash before the proceeds arrive?
This is where the two-event picture matters. Event A is the next commitment: a deposit on new premises, a fit-out, a purchase. Event B is the net proceeds above. The bridge sits between them, and its repayment is the cash you receive on completion, not the headline price.
If the new commitment is $500,000 and you plan to repay it from the completion cash of $699,000, the end debt is nil and about $199,000 is left. If completion slips 30 days and the stock count comes in lower, the bridge is open for 30 more days and the surplus shrinks. Run your own dates and figures in the bridging calculator; the peak debt and end debt page explains the two numbers a lender looks at. Our page on business sale proceeds as an exit shows the evidence that supports it, and our guide on how long it takes to sell a business shows where the date can slip.
If you’d like a second pair of eyes on the numbers, you can check your options here.
What’s the checklist before you answer the offer?
- Get the broker’s commission basis and minimum in writing.
- Ask each lender for a payout figure and its expiry date.
- Run a leave and entitlements report from payroll.
- Ask your accountant for a CGT estimate and a reserve figure.
- Ask your lawyer about retention, deferred payments and the adjustments clause.
- Build the net table above with your own figures, then add a slow-case column.
Ready to put real numbers against your next move?
Selling a business is rarely one event. It’s a sale, then a purchase, a lease or a fresh start, and the gap between them is where owners get caught. If you want to commit to the next step before the proceeds land, we can look at the sale as the exit and size a bridge to the cash you’ll actually receive.
Enquiring takes about 60 seconds, and asking doesn’t touch your credit file, so there’s no cost to finding out where you stand. We don’t send your details to a pile of lenders; a real person who works on bridges reads your situation and calls you. Please fill the form in accurately, with the real price, the payouts and the dates, so we can match the right structure the first time.
Frequently asked questions
How much of the sale price do I actually keep when I sell a business?
It varies with your debts, your staff and your tax position, so work it out line by line. Start with the price, then deduct broker commission, legal and accounting costs, loans secured on the business, leave and entitlements you must pay out, any retention and a CGT reserve. In the example in this guide, about 70 cents in the dollar is spendable.
How much do business brokers charge when you sell?
Brokers usually charge a percentage of the sale price. One Australian marketplace guide puts the range at 5% to 12% depending on deal size, with smaller sales often subject to a minimum success fee that can make the effective figure higher. Check the engagement letter for the rate, the minimum and what the commission is calculated on.
Is commission charged on stock at valuation?
Often it isn't, because stock is treated as a liquid asset on top of the business value. Broker guides say commission is commonly calculated on goodwill and plant and equipment. That's a contract term, not a rule, so ask for it in writing before you sign the listing.
What happens to my employees' leave when I sell?
The Fair Work Ombudsman explains that on a transfer of business the new employer can recognise employees' service, in which case accrued annual leave carries across, or not, in which case the old employer pays it out. The sale contract usually adjusts the price either way. Ask your lawyer which applies to your buyer.
When do I pay capital gains tax on the sale of my business?
The ATO treats the CGT event as happening when you enter into the contract, so the gain falls in that income year, but the tax is assessed with your return, not taken at settlement. The small business CGT concessions can reduce or defer it if you meet the basic conditions, so ask your accountant for a figure.
Can I borrow against my sale proceeds before the sale settles?
Yes, in many cases. A lender will look at the contract, the net proceeds after every deduction and the date you receive them. A short-term bridge is usually repaid at settlement, so it must be sized to the net figure, not the headline price. Approval isn't guaranteed and depends on your full situation.