The general position.
Duty on the sale of a business was largely abolished, so buying the business as such, its goodwill, plant, equipment and stock, generally does not attract duty in Victoria. That is the reassuring headline, and for a straightforward small business sale it is usually the end of the story. Our business sale and purchase service deals with the duty points as part of the transaction.
Where duty still bites.
A few things that commonly form part of a business sale do attract duty. The transfer of motor vehicles is dutiable, including registered plant such as trucks, graders and bobcats, and the duty is based on the price or the market value, whichever is higher, so an agreed value between the parties is not the last word. If the sale includes real property, the freehold premises, that is dutiable as a transfer of land in the usual way, which is why a business sold with its building is handled as two linked contracts, one for the business and one for the land. Duty can also arise where consideration beyond rent is paid for a lease or an option over land.
Why it is worth checking.
The duty that survives is easy to overlook, because the headline answer is “no duty on a business”. Vehicles in particular catch people, and the market-value rule means the figure is a question of fact, not just what the contract says. Confirming the duty position before you sign avoids an unexpected cost at settlement.
“No stamp duty on a business” is true for the business itself, but not for vehicles or any property included, and the vehicle duty is on market value, not just the price you put on them.
Law referenced: Victorian duties legislation (State Revenue Office); Transfer of Land Act 1958 in passing.