- There are four concessions: the 15-year exemption, the 50% active asset reduction, the retirement exemption and the small business rollover.
- To get in the door, you need aggregated turnover under $2 million or net assets of no more than $6 million under the maximum net asset value test.
- The net asset value test uses the market value of assets, including goodwill, not the figures in your balance sheet.
- Selling shares or trust units brings extra tests, and one of them also looks at market values.
- Your accountant or tax adviser decides whether you qualify. We value the business or interest.
The four concessions in one paragraph
When you make a capital gain on an asset used in a small business, there are four concessions that may cut the gain down. The 15-year exemption can disregard the whole gain where the asset has been owned for at least 15 years and the owner is 55 or older and retiring, or permanently incapacitated. The 50% active asset reduction halves what is left of the gain, and applies automatically if the basic conditions are met. The retirement exemption can disregard a gain up to a lifetime limit of $500,000, with money paid into super if you are under 55. The small business rollover can defer some or all of a gain, for example where you buy a replacement business asset. Each one has its own extra conditions.
The basic conditions, in plain words
Before any of the four can apply, some basic conditions must be met. In general terms:
- You must be small enough. Either your aggregated turnover is under $2 million, or you pass the maximum net asset value test: the net value of the assets of you and certain related entities must not be more than $6 million just before the CGT event.
- The asset must be an active asset. Broadly, it must have been used, or held ready for use, in running a business for long enough while you owned it.
- Shares and trust units need more. If what you are selling is shares in a company or units in a trust, there are extra conditions. One is the 80% test: the market value of the company's or trust's active assets (with cash and financial instruments that are part of the business) must make up at least 80% of the market value of all its assets.
Your accountant works through these conditions. We do not decide whether you pass them.
Why market value matters here
Two of those tests are built on market value.
The maximum net asset value test adds up the market value of CGT assets held by you, your connected entities, and in some cases your affiliates, then takes off related liabilities and certain provisions. Goodwill is a CGT asset, so its market value counts, even if it appears nowhere in your accounts. We explain the detail on our maximum net asset value test page.
The 80% test for shares and trust interests compares the market value of the entity's active assets with the market value of everything it holds. A company with a large cash balance or investment property next to a trading business can be closer to the line than its owners think.
In both tests, using book value can give the wrong answer. A business carried at a small figure on the balance sheet can be worth much more on the open market. The reverse can happen too.
When a valuation helps
A valuation is most useful where the answer is not obvious:
- Your turnover is over $2 million, so you rely on the net asset value test.
- Your group's net assets look like they might be somewhere near $6 million.
- You are selling shares or units and the 80% test is in question.
- The business has significant goodwill that has never been valued.
- You want a record made at the time of the sale, rather than rebuilt later.
If your turnover is clearly under $2 million and the asset is plainly active, your accountant may tell you a valuation adds little. That is a fair answer, and we would rather you ask first.
What the valuation report covers for this purpose
For the small business concessions, the Professional Valuation Report sets out:
- the business, shares or interest valued, and the entity that owns it
- the valuation date your accountant gives us, usually just before the CGT event
- the standard of value: market value
- the method used and why, the earnings or assets it relies on, and the adjustments made
- where asked, a separate figure for goodwill and for other major assets, so your accountant can use them in the net asset value or 80% test
- the evidence, assumptions and limitations, signed by the valuer responsible
The ATO decides for itself whether to accept a valuation. Its guidance says acceptability usually depends on the process followed rather than who conducted it, which is why the report shows its working. We follow APES 225 as the guidelines for our valuations.
What we need from you
- Financial statements and tax returns for the last three years
- Management accounts up to the valuation date
- The structure: who owns what, through which company, trust or partnership
- A short note from your accountant on what the value is for and the date
- Details of any sale contract, offer or heads of agreement
- Key contracts, leases and a customer summary
The full list is on our documents page.
Get a fixed fee
Our fee is fixed by the annual revenue of the business, starting at $1,495 + GST for revenue under $1 million. Revenue of $10 million or more is a custom fixed-fee quote. Use the price tool below or start here.
General information only, current at 10 November 2026. We value businesses and business interests; we do not give tax advice. Your accountant or tax adviser decides whether a rule applies to you.