AUSuccession and exit planning for business owners
General information, not financial, tax or legal advice. Check your own plan with your accountant, lawyer or a business adviser.
A succession plan sets out who takes over your business and how.1 The successor can be a family member, an employee, a business partner or an outside buyer.1 Start the plan well before you leave: it also covers a sudden exit through illness, injury or another unexpected event.1 More broadly, an exit strategy is the decision behind that plan: selling the business as a going concern, selling to management in a buyout, handing it to family, or winding it down.
What a succession plan covers
A succession plan is a document, not just an intention. Business.gov.au gives five tips for writing one:1
- Choose the right successor and check they have the skills, the will and the means to take over.
- Value the business regularly. The value can change a lot before you leave, and a current valuation helps you plan.1
- Document your processes, policies and procedures, so knowledge doesn't leave with you.
- Plan for a sudden transition, so someone else could run the business if you couldn't.
- Review the plan as your business and your circumstances change.
The main exit routes
Business.gov.au groups exit routes into selling, closing, bankruptcy or insolvency, dissolving a partnership, and succession planning.2 Selling, closing or changing your business also means updating your registrations.2 Common exit routes include:
- An outside buyer, in a trade sale to someone unconnected to the business.
- A management buyout: the people already running the business buy it from you.
- A family member, in an inter-generational transfer.
- A wind-down: closing the business and selling assets individually, rather than selling it as a going concern.
A management buyout can keep staff, systems and customer relationships in place.
Building your own plan
Start with your own timeframe: years ahead, or a reaction to a change in circumstances. Then set out the operational detail: what the new owner takes on and when, what training or handover you'll provide, and what happens to your role while that happens.
If your exit route is a management buyout, put the terms in writing and agree a timeline early, even informally.
Tax and other advice
The tax guide covers CGT and the small business concessions that may apply if you meet the conditions. A lawyer should still draft the sale or shareholder documents, and an accountant should model the tax outcome of each route before you commit to one. See business valuation for how a price is worked out, and business brokers if you use one to help sell. Signetry lists businesses for sale. It doesn't advise on which exit route suits your situation.
Sources
- Develop your succession plan, business.gov.au, no last-updated date shown, accessed 24 Sep 2026. Succession plan definition, the five tips, and successor types.
- Exiting, business.gov.au, no last-updated date shown, accessed 24 Sep 2026. Lists the exit routes: closing your business, selling your business, bankruptcy and insolvency, dissolving a business partnership and succession planning, with a single reminder to update your registrations if you are selling, closing or changing your business.