Buying a business

When you buy a business in NSW, you must pay transfer duty if the sale includes land or an interest in land, such as a lease.

If it does, you may also need to pay transfer duty on the assets used to operate the business, including  warehouse equipment and computers.

Transfer duty is due three months after you sign the business sale agreement.

Assets included

A business is any activity you do regularly/ with the aim of making a profit.

It does not need to be a company, corporation, partnership or have any formal organisation. It can be any size. Selling homemade jam at a local market each Sunday is a business.

To work out the value of your business, include:

• land and property
• interest in land, such as a lease
• plant and equipment
• shares and units
• goods that are not stock-in-trade, under manufacture, or excluded from transfer duty.

You may also need to pay a $10 transfer duty for any:

• sale of a business agreement
• duplicate sale of a business agreement
• transfer of lease
• transfer in conformity to the agreement.

Read more about the assets you must pay transfer duty on in section 11 of the Duties Act 1997.

Excluded assets

Generally, you will not pay transfer duty on:

• goods that are stock-in-trade
• manufacturing materials, or anything under manufacture
• assets used on land for primary production
• livestock
• registered vehicles
• ships or vessels.

The exception applies to assets that cannot be moved from the property.

From 30 June 2016, you also no longer have to pay transfer duty on:

• gaming machines
• intellectual property used in NSW
• licences or permissions under NSW law or Commonwealth law, if used in NSW, such as a taxi licence or water access licence
• the goodwill of a business, if it supplies goods or services in NSW.

You must pay transfer duty on these assets if your agreement is replacing one made before 1 July 2016 for the same business property and assets.

You do not pay transfer duty if goods, rather than land or an interest in land, make up more than 90 per cent of the value of the sale.

Buying land and assets under separate contracts

Transfer duty is calculated as though it's one transaction when land and business goods are sold under different agreements, but as part of the same arrangement, including:

• agreements containing an inter-dependency clause
• where the parties entered into options before making the final agreements.

The buyers and sellers do not need to be the same parties on each agreement for it to be the same arrangement.

Calculating transfer duty

The easiest way to work out how much transfer duty you'll need to pay is by using our online calculator.

Calculate your transfer duty

Contact us

Contact us for more information on buying a business and paying transfer duty.