retirement Archives - dmca advisory

What is the CGT Retirement Exemption?

One of the biggest advantages to those looking forward to retirement is the capital gains tax exemption. This can be applied to the sale of an active business asset, up to a lifetime limit of $500,000.

If you are under 55, money from the disposal of the asset must be paid into a complying superannuation fund. Amounts from this exemption may be able to be contributed to the fund without affecting your non-concessional contributions limits.

For those 55 and over, the tax-free gain can be taken in cash or by transfer of property or it can be contributed to a superannuation fund of your choice. If the individual is more than 65 years of age, they will have to satisfy the contribution rules to be eligible to contribute.

For those selling a business in the years leading up to retirement, the CGT retirement exemption can prove extremely beneficial. For more information about this topic, read this piece from Adam Griffiths on preparing to sell a business https://insidesmallbusiness.com.au/planning-management/how-to-sell-your-business-for-the-best-price

For more strategies on planning for retirement including other CGT exemptions, call dmca on 08 8272 5620 for a chat about what options are best suited to your circumstances.