The ATO is proposing to modify how the small business restructure rollover (SBRR) operates.
The SBRR means that small businesses can restructure from one legal entity to another – for example, from a company to a trust – and transfer the business’s assets to the new structure without immediately causing a capital gains tax liability.
The ATO’s latest proposed changes address the fact that the transferred business assets in this type of restructure could still give rise to a dividend for the transferee.
TIP: Are you thinking about changing how your small business operates? Talk to us for more information about the options and tax implications.