Succession planning - More than an exit strategy

Kerry Schmidt • October 1, 2024

Although the day may be a long way off, when it comes to exiting your business, the golden rule is to start planning early.

With a detailed succession plan in place like our ‘Steps Forward’ Program – which follows our “10 Ws to successful succession”, you are the one who gets to decide how – and when – you leave your business.


You also need to ensure the viability of the business does not rely on your profile or name. By planning ahead, you’re able to slowly remove your strong links with the business so that it can function successfully without you.


Current employees and customers need to be locked into the business even if you are no longer going to be involved, otherwise buyers may be reluctant to purchase.


More than an exit strategy

A good succession plan is more than a simple departure blueprint. It should be part of your current business plan and considered when you initially structure your operation.i


Regularly updating your plan and obtaining a current business valuation helps ensure you are always prepared in the event you need to exit earlier than anticipated.


If you intend to transfer ownership of the business to a family member or employee, your succession planning needs to include decisions such as whether you intend to retain an interest in the business, or ownership of any business-related property.


A strategy for funding your successor’s purchase of the business should also be developed.


Prepare for the unexpected

Unplanned succession events (such as poor health or sudden death), also need to be considered to ensure the business can continue operating with minimal disruption.


One approach that may suit some is to establish a buy-sell agreement in which a partner agrees to sell their interest if specified trigger events (usually death or total and permanent disability) occur, with the other partners agreeing to purchase the interest. These agreements usually outline how the value of the interest will be determined and how it will be transferred, and the payment funded.ii


Buy-sell agreements are generally funded from the proceeds of insurance policies covering each partner, enabling easy repayment of the outgoing partner’s interest in the business.


Take your time

Although internal succession to a family member or employee can be an attractive exit option, transfer of ownership in this fashion usually requires a lengthy timeframe.


Internal succession generally involves a gradual sell down of equity to the new owner and a staged step-down by the original owner from the business.


These arrangements mean you need to ensure your successor has the right skills and capabilities to take over and continue running the business successfully. They may also require you to remain onboard for several years.


Alternatively, you may want an external sale transaction covering the whole business or its assets.


In this case there is usually a faster transition, but the purchaser may still want you to remain with the business for six to 12 months to facilitate a smooth transition.


Preparing for change

Whichever process you select, you will need to invest quite a bit of time before going to market to ensure your business presents as an attractive opportunity to potential purchasers.


Significant issues such as ensuring the current business structure is appropriate need to be addressed. For example, a business held in a family trust will require restructuring prior to any sale.iii


Detailed and accurate information about the business and both its financial and market position need to be compiled. Most potential buyers expect to see financial statements covering at least three financial years.


Prospective purchasers will also expect your employees to be on appropriate employment contracts to ensure they stay on after the sale.


Get good advice

Key to ensuring a smooth exit from your business is getting professional advice early in the process.


We can assist you with preparing your business operations and records and help ensure you are prepared to answer questions or information requests. Issues such as the best tax structure, tax implications of buy-sell agreements and advice on how to take advantage of CGT tax concessions can be reviewed.iv We can also provide advice about appropriate pricing for your business, as valuation formulas vary between industries.


If you would like help with developing a succession plan for your business, contact our office today. We’re experienced at working with small businesses and farming families to help with all the intricate details involved in planning and implementing a successful succession plan.




i Develop your succession plan | business.gov.au

ii Sale of a going concern | Australian Taxation Office (ato.gov.au)

iii Small business restructure roll-over | Australian Taxation Office (ato.gov.au)

iv Small business CGT concessions | Australian Taxation Office (ato.gov.au)

Do you know how your super is performing?

By Nikki Ashurst • November 2, 2026
Many Australians don't know how their super fund has performed or what it invests in. Are you one of them? Here's what to check and why it matters. Do you know how your super fund performed over the last two years? Many Australians don’t and are working towards their financial future without fully understanding one of their most important assets and without a clear plan for how their super may support them in retirement. That's not surprising, as many people view super as something that should run quietly in the background while they're busy with careers, families and everything else that life throws at them. But when you’re not sure what’s happening behind your balance, it’s harder to know whether you’re on track, whether your current approach reflects your goals or what opportunities might be available to help you make the most of what you’ve built so far. Your super isn't sitting in an account, it's invested Super is invested by a fund on your behalf across a mix of assets, with those investments working to grow your balance over time. Those include: Shares Ownership in Australian and international publicly listed companies. Their value can rise and fall, sometimes substantially over short periods but shares can provide capital growth over the long term. Property and infrastructure Real assets like office buildings, shopping centres, airports and energy networks. They can produce income and don't always behave in the same way as share markets, helping diversify investment holdings. Fixed interest and bonds Lending to governments and companies in return for interest. They can provide regular income and be steadier than shares, although returns and risk vary depending on the investment. Cash Generally, the most stable and lowest risk investment type. It can provide stability and faster access to money but typically offers lower longer term return potential. The investment option you choose determines the mix of assets held in your super based on your risk appetite. Most super funds offer options from conservative to high growth. If you’re young, a growth option with a higher exposure to growth assets like shares could offer higher returns over time – but it also comes with higher risk. As retirement nears, you might want to consider a more conservative approach with more defensive assets, like bonds for example to protect your savings. If you've never made a choice, you're probably in your fund's default option, which is designed to suit a broad membership. It’s worth knowing whether the mix you're in matches your circumstances and goals, including how far you are from retirement. Why performance alone is not a true comparison If you're thinking about how your super compares, returns are often where people start. The trouble is that a return figure means nothing without context: What it's being compared to Growth and conservative options invest differently and with different levels of risk. Compare like with like or the comparison may not be genuine. The comparison period A single year can be heavily influenced by short term market conditions. Super is measured in decades, so five, seven and ten year returns tell you far more about whether a fund is consistently doing its job, albeit not a predictor of future performance. Fees and tax Published returns should reflect investment fees, costs and tax but administration fees may be charged separately from your balance. Two funds quoting the same return can leave you in meaningfully different places once all fees are accounted for. Then there are the things that returns can't show you at all. For example, what insurance is attached to your account and what it's costing you, whether the fund offers guidance, tools and advice or simply sends a statement once a year. Another consideration maybe the level of support available when you need it. When comparing funds, it's worth looking at the full picture, including performance, fees, investment options, retirement support and member benefits. What today’s decisions mean tomorrow To understand how your super stacks up, start here: Find your investment option It's on your annual statement and in your online account. Look at what's in it Your fund publishes the asset allocation (shares, cash etc.) for each investment option. Check the long-term return for that option Focus on five and ten year returns, not just last year and compare them with equivalent options. Understand the total cost Add together administration fees, investment fees and insurance premiums as an annual dollar figure. Comparing super is about working out which option will perform best for you. Before you jump in, it’s worth understanding what's behind the numbers so you can make decisions based on more than a headline return. Knowing where you stand is the first step A super balance tells you where you are today. Understanding how your super is invested, how it compares and whether it's aligned with your goals helps show whether you're heading in the right direction. Source: MLC The information in this article does not take into account your objectives, needs and circumstances. We recommend that you obtain investment and taxation advice specific to your investment objectives, financial situation and particular needs before making any investment decision or acting on any of the information contained in this document. Subject to law, Capstone Financial Planning nor their directors, employees or authorised representatives gives any representation or warranty as to the reliability, accuracy or completeness of the information; or accepts any responsibility for any person acting, or refraining from acting, on the basis of the information contained in this document. Principal Wealth Management Pty Ltd trading as BMO Financial Solutions ABN 53 109 336 601 is a Corporate Authorised Representative (CAR 277821) of Capstone Financial Planning Pty Ltd ABN 24 093 733 969 Australian Financial Services Licence (AFSL) No. 223135.

The SMSF landscape is changing

By Jude Schofield • October 7, 2026
More Australians are choosing to take direct control of their retirement savings by establishing a self-managed super fund (SMSF) and according to the SMSF Association, Aussies now see their super as an important part of building and managing their overall wealth.