Succession planning and why it should be at the top of your to-do list

Making decisions about the future of your business can feel overwhelming, or just not top of mind when consumed by the demands of running your business day-to-day. Many family business leaders aim to pass their businesses to the next generation but there is often a significant gap between intention and preparation.

Deep down, we know it’s important to plan and prepare for what’s next. We contribute to superannuation for our retirement, purchase travel insurance before heading overseas and write a will to share our wishes with family. Planning ahead helps protect us and achieve our goals.

The same principle applies to family businesses and enterprises. Yet despite its importance, succession planning is frequently neglected.

'Succession is about more than who is going to step into the role when the current generation steps down. It is easy to think a few conversations will get succession sorted, but in reality, it is a process that takes time, planning and patience, and communication.' Catherine Sayer, Family Business Association (FBA) CEO.

Why it’s important to plan

Having a well communicated and documented succession plan is essential to answering questions about the future of your business.

A succession plan will help you to outline:

who will take over the family business

how the transition will occur

the structures and rules that will guide the process.

The 2025 Family Business Barometer Report found that while 45% of respondents nominated a successful exit strategy as a long-term goal, only 23% have a formal succession plan and 37% acknowledge the process is complex. These figures show the need to move succession planning from the bottom of the to-do list to the top.

'Succession planning often gets pushed aside because the immediate priority is keeping the business running. Many family business owners continually tell themselves they’ll address it later, but later often comes too late.' Matthew Bartemucci, Director at Hood Sweeney and FBA Accredited Advisor.

As a business owner you need to ask yourself the following questions:

Have I discussed the business's future with anyone?

Have I worked through who will take over leadership?

Are they prepared to take over?

Is everyone aligned on these decisions?

How to plan effectively

There are 4 key areas for effective succession planning in your family business:

Plan early.

Communicate.

Document the process.

Prepare the next generation.

1. Plan early

Planning early gives you time to approach succession thoughtfully, rather than reacting under pressure. Starting as early as 10 to 15 years before a transition helps safeguard your business in the event of unexpected circumstances. It gives you time to explore options openly, rather than making rushed decisions in a crisis.

Give your family the room to consider different paths. Many businesses will stay in family hands, while others may be sold if circumstances or goals shift. Survey results from the Family Business Barometer Report reflect this with 42% of the participants planning to pass the business to the next generation, while 45% intend to prepare for a sale or exit.

If you decide to keep the business, early planning will give you the time to identify potential successors, whether from within the family or outside the business. This allows time for targeted training and development, so the person or people stepping into leadership are prepared to take on their responsibilities.

Early planning also provides an opportunity to establish rules, processes and governance structures that support a smooth and well-organised transition.

2. Communicate

Succession touches on family relationships as much as it does business structures. You may worry that raising the topic could spark conflict or reopen old wounds.

'It’s hard to begin. It could lead to conflict, upset someone or open a can of worms. But here’s the truth – not having the conversation doesn’t make things better. Silence just lets assumptions harden and tensions build up.' Iain Massey, CEO of Upland Consulting and FBA Accredited Advisor.

The Family Business Barometer Report data supports the value of communication. 36% of the participants said balancing family versus business needs kept them awake at night. Nearly 10% of participants said sibling rivalry was a concern.

Open dialogue can help prevent these issues before they become a bigger problem and stops the potential for assumptions being made across the family.

3. Document the process

One of the most practical and impactful steps in succession planning is documentation.

Recording the structures, rules and decision-making practices ensures that knowledge is preserved. It can prevent misunderstandings when leadership or ownership changes hands.

Some family businesses assume that family connections automatically grant entitlement to roles or responsibilities. Addressing these assumptions early through documentation helps avoid conflict within families and the business.

Expert advice strongly encourages documentation of everything very early on in the process. Good documentation makes life a lot easier for future family members to come in.

The Family Business Barometer Report results show that formal governance structures remain underused. Less than a quarter of businesses have a documented succession plan and only 31% report having a family charter or constitution.

Clear governance structures, including detailed position descriptions and defined job responsibilities, not only maintain fairness but can also highlight where external expertise may be needed.

By documenting processes thoroughly, a business provides transparency and clarity for everyone involved. It supports the smooth integration of successors, ensuring the business can operate effectively, even during periods of transition.

4. Prepare the next generation

Succession is ultimately about people. Giving emerging leaders the knowledge and confidence to take the reins takes time and intent. Provide them with exposure to different roles, encourage formal training and allow them to gain experience outside the family business.

Annette Bonnett advises, ‘Having discussions with next-generation family members about their progression path in the business is vital. Set a clear development plan that covers governance, financial literacy, operational responsibilities and risk. Measure progress, stick to the plan and recognise this is a journey.’

Succession isn’t just about handing over leadership; it’s about preparing the next generation. It’s a long, evolving process that adapts as the business, family and future leaders grow, ensuring they’re prepared to take on the role and lead.

9 Apr 2026

Business Victoria

Choosing the right trustee structure for your SMSF

A self-managed super fund (SMSF) is a useful step to control your retirement saving, however is it important to decide your right trustee structure to suit how the fund operates.

You have two main trustee structure options for your SMSF:

• individual trustees – where each member of the fund acts as a trustee; or

• corporate trustee – where a company acts as the trustee of the fund.

With individual trustees, each member of your SMSF must be a trustee. This means if you have a two-member fund, both members must be trustees.

The main advantages of individual trustees include:

• typically lower setup costs;

• simpler initial structure; and

no ongoing annual company fees

However, there are some drawbacks:

• all trustees must sign fund documents, which can be cumbersome;

• any penalties for legal or regulatory breaches are imposed on each individual trustee (costing more in fines);

• if a trustee dies, assets may need to be transferred; and

• changes to membership require updating legal documents.

A corporate trustee structure uses a company as the trustee of your SMSF. The members of the fund become directors of the company, giving them control over fund decisions.

The benefits of a corporate trustee include:

• continuity – the company continues even if directors change;

• easier administration when members join or leave;

• assets are held in the company name, reducing paperwork when membership changes;

• any penalties for legal or regulatory breaches constitute a single fine (where directors share the cost); and

• only one signature may be required for fund documents (depending on the company’s constitution).

The main disadvantages are:

• higher setup costs to establish the company;

• ongoing annual ASIC fees; and

• additional compliance obligations for the company.

The right choice depends on your circumstances. Consider factors such as:

• the number of members in your fund;

• whether you expect membership to change over time and how often;

• your tolerance for ongoing costs versus convenience;

• the value of assets you plan to hold in the SMSF; and

• your long-term plans for the fund (ie bringing in other members, etc)

Remember that changing trustee structures later can be complex and costly. You may need to transfer assets and update legal documents. Choosing your SMSF trustee structure is a crucial decision that will impact your fund’s operation for years to come. The choice between individual and corporate trustees involves weighing up costs, convenience and your long-term plans.

Acctweb

ATO taking a closer look at investment properties

Owning an investment property can be tax-effective, but it’s also one of the ATO’s most closely monitored areas. Here are five common errors that most often trigger ATO follow-up, and the related issues to keep in mind.

Over-claiming repairs that should be capital works

Repairs and maintenance can be claimed for work that remedies or prevents defects, damage or deterioration arising from using the property to earn income. These expenses are generally deductible in the year they are incurred. By contrast, capital works are structural improvements, alterations or extensions that go beyond merely fixing wear and tear. If the work improves the function or value of the property, it’s likely to be capital in nature. Capital works are usually claimed at 2.5% over 40 years (subject to specific exceptions).

Claiming deductions during private use periods

You can’t claim deductions for interest or other expenses for periods when a holiday home or mixed-use property is used privately, even if the private use is brief. To legitimately claim deductions, the property must be rented or genuinely available for rent. This may include limited/no advertising, offering during low demand times or rent attached to unreasonable conditions such as above-market rent or overly restrictive tenant requirements.

Repeatedly refusing suitable tenants without valid reasons can also indicate the property is being held for personal use rather than income producing purposes.

Claiming incorrect interest deductions

You can only claim the portion of interest that relates to the rental property. If a loan’s used for both private purposes and rental property expenses, the interest must be apportioned. This applies whenever the mixed use occurs at any time during the loan and continue over the life of the loan.

Poor record keeping and lack of substantiation

You must keep records of your rental income and expenses for at least five years from the date you lodge your tax return. If a dispute with the ATO arises during that period, you must retain relevant records until the dispute is resolved.

Not reporting all rental-related income

Rental-related income includes more than just rent. It can also include bond money retained for unpaid rent or damage, letting or booking fees from cancelled reservations, and insurance payouts, whether for property damage or loss of rent.

Acctweb

Major super tax changes now law

Two key Bills have passed Parliament recently that will mean significant changes to Australia's superannuation system that will reshape how high-balance accounts are taxed and boost support for low-income earners.

Division 296 tax

The new Division 296 tax, commencing 1 July 2026, targets earnings on large superannuation balances through a two-tiered system for earnings on balances exceeding $3 million:

the current 15% tax rate remains for earnings on balances up to $3 million;
earnings on the super portion between $3 million and $10 million will be taxed at an effective 30% rate; and
earnings on amounts above $10 million will face a 40% effective tax rate.

These thresholds will be CPI indexed to keep pace with inflation. The new tax applies only to future realised earnings, not unrealised capital gains on unsold assets.

Importantly, for the first year only, liability is determined based on your total super balance at 30 June 2027, rather than at the start of the year.

Total super balance calculations

The law also introduces a “total superannuation balance (TSB) value” concept, with each superannuation interest having its own TSB value. Your total TSB becomes the sum of all these values across your Australian superannuation interests an applies from 1 July 2026.

Low Income Superannuation Tax Offset (LISTO) increases

From 1 July 2027, the maximum LISTO increases from $500 to $810, while the eligibility threshold rises from $37,000 to $45,000.

These changes represent the most significant superannuation tax reforms in years. If you have a large superannuation balance, the window before 30 June 2027 provides time to consider your options. Low-income earners will benefit from enhanced LISTO support from 2027.

Acctweb

RSM welcomes updated PCG on transfer pricing for inbound distributors

RSM has welcomed the ATO’s updated compliance guide on transfer pricing for inbound distributors, saying it would bring additional clarity for taxpayers.

Last week (22 April), the Tax Office updated its transfer pricing guidelines for inbound distributors to reflect recent market conditions.

Liam Delahunty, partner and international tax and transfer pricing lead at RSM Australia, said the updated practical compliance guide (PCG) was welcome, and provided inbound distributors with greater certainty surrounding their tax risks.

“The PCG is a really helpful and welcome guideline that the ATO has published which will continue to help both taxpayers and their advisors understand the ATO’s perception of risks,” Delahunty told Accountants Daily.

“It’s a timely reinforcement that the ATO does continue to reassess market conditions. So it’s positive.”

Key changes in the ATO’s PCG 2019/1, Transfer pricing issues related to inbound distribution arrangements, included a broadened definition of inbound distributors, updated profit markers, the introduction of a white zone and clearer guidance on reportable tax position (RTP) schedules.

The operating margin benchmarks for certain activities in the life sciences and ICT sectors were revised downwards to reflect market conditions, which Delahunty noted had weakened.

“Probably the most important thing that it shows is that the ATO has reassessed market conditions, and found that market conditions are such that now there’s an expectation of less profit in Australia for some sectors,” he said.

“Particularly for Life Sciences, the expected profit levels have come down. And for ICT, the profit markers have come down as well. So that just is a reflection, I suppose, of market conditions being tougher in those sectors, and therefore the ATO’s expectations of profit levels also come down.”

The ATO also expanded its definition of ‘inbound distributor’ in the updated PCG, swapping the word ‘comprised’ to ‘predominantly involves,’ a change RSM said had expanded the potential application of the guide.

The updated PCG also tightened the definition of digital product distributors, a change RSM said may interact adversely with the ATO’s view on Australian data centre activities as an emerging issue.

The new definition included businesses that sold digital products or services in which the associated intellectual property was substantially held by related foreign entities, where the inbound distributor did not significantly contribute to the creation of the products or services.

“For example, you significantly contribute to the creation of digital products or services if you or your related entities own or operate significant equipment in Australia used to host or provide the products or services you are selling or distributing,” the PCG read.

In the updated PCG, the Tax Office also introduced a ‘white zone’ in addition to its green, yellow and red zone risk ratings. The white zone would apply to cases where taxpayers had an advanced pricing agreement (APA) with the ATO, for example, following a court judgment.

“We will not have cause to apply compliance resources to further review the transfer pricing outcomes of your inbound distribution arrangements, other than to confirm ongoing consistency with the agreed approach,” the ATO said of its approach to ‘white zone’ cases.

27 April 2026
Emma Partis
accountantsdaily.com.au/

ATO reminds practitioners to avoid common FBT mistakes

The ATO has warned tax practitioners about common mistakes made by taxpayers and their advisers when lodging fringe benefits tax returns.

During a March webinar, the ATO laid out common mistakes made by taxpayers and advisers when lodging their fringe benefits tax (FBT) returns.

ATO facilitator Ben Eames reminded practitioners that plug-in hybrid vehicles were no longer exempt from FBT from 31 March 2025. For those looking to take advantage of grandfathering provisions, he urged tax practitioners to ensure they adhered to the strict eligibility criteria.

“If you are a tax professional, the key task is to identify your employer clients you have with pre-existing plug in hybrid arrangements and verify that all necessary documentation is in place,” he said.

“This includes reviewing contracts, advice, letters, and any correspondence that confirms the timing and nature of the commitment.”

Eames also warned that the ATO had identified gaps in tax practitioners’ FBT knowledge, which was leading to errors in taxpayers’ returns.

“Even more concerning, we found gaps in professional knowledge. Some [tax professionals] had not maintained their FBT expertise, and this led to common mistakes being made and their employer clients not complying with their obligations,” he said.

“Around 90 per cent of all lodged FBT returns are done by tax agents, so you, as trusted advisors, play a critical role in helping employers meet their FBT tax obligations.”

To avoid FBT return errors, Eames urged tax practitioners to follow four key steps, which he said could help clients avoid unexpected liabilities, extra paperwork, and costly penalties.

First, he urged practitioners to identify the type of benefit being provided, which would dictate the calculation methods used to work out the taxable value and the record-keeping required.

Next, Eames said practitioners should determine the taxable value of each benefit, depending on its type. Thirdly, he said that accurate records must be kept to support any claims and calculations made.

Even if the FBT liability was nil, employers may still need to keep records, he noted.

Lastly, he said that FBT returns needed to be lodged on time, and liabilities had to be paid by the due date. Employers with no FBT liability for the year but who are registered for FBT should send the ATO a completed notice of non-lodgment to avoid ATO follow-ups.

“FBT returns are due on the 21st of May for employers lodging themselves and tax agents who lodge by paper,” Eames said.

“The due date for the Tax Agent Lodgement Program is the 25th of June, and for this due date to apply, the employer needs to be an FBT client of the tax agent by the 21st of May, and the tax agent needs to lodge the client's FBT return electronically via the Practitioner Lodgement Service.”

He said that following those four simple steps would mitigate most of the mistakes the ATO observed in taxpayers’ FBT returns, reducing the risk of future ATO action.

“We are using sophisticated data and analytics to identify businesses that are not meeting their obligations. We are actively contacting businesses and employers that do not get it right to encourage them to self-correct,” Eames said.

“For employers that do not respond or are not voluntarily complying with their obligations, the ATO may take firmer action to ensure they pay the correct amount of tax and penalties applied can be significant.”

28 April 2026
Emma Partis
accountantsdaily.com.au

Why every business should have an AI policy

Discover why a clear workplace AI policy is essential to protect your business, ensure compliance, and harness AI safely.

Artificial intelligence (AI) isn’t just a buzzword. It has quickly become part of everyday work. Whether it’s drafting documents, analysing data, creating marketing content, or streamlining customer interactions. In many small and medium-sized businesses, employees are already experimenting with AI tools, often without formal guidance or approval from their employer.

While enthusiasm for creating significant efficiencies is great, it also introduces new risks. Without a clear AI policy, businesses may unknowingly expose themselves to issues such as confidentiality breaches, inappropriate use of AI-generated content, or a false sense of certainty about the accuracy of information produced by AI tools.

As AI becomes more embedded in routine business tasks, it’s increasingly important for employers to set clear expectations. That’s where a workplace AI policy comes in.

Why an AI policy is no longer optional

1. Employees are using AI with or without approval

Many staff adopt AI informally, using it to summarise documents, write emails, draft reports, or generate creative content. Without guidelines, employees may use AI tools differently and fail to consider the risks.

An AI policy helps employers set boundaries around:

Which AI tools are approved?
Which tools must not be used?
When employees must seek permission before using AI,
How AI tools should be used to support, not replace professional judgement.

Research shows that 75% of employees use AI at work, and up to 33% hide that use from management. Many rely on personal accounts or unapproved platforms, creating massive security blind spots.

2. Protecting confidentiality and business IP

AI systems often store or analyse the information users enter. If an employee uploads sensitive data such as client records, financial information, or internal documents, it may compromise confidentiality or intellectual property. For example, in the healthcare sector, it has been found that workers have uploaded protected patient health information to generative AI tools such as ChatGPT and Google.

Gemini often does so through their personal accounts, thereby violating privacy laws and exposing organisations to regulatory penalties.

A solid AI policy can guide employees on:

What information can and cannot be entered into AI tools?
How to handle personal, confidential, or commercially sensitive data
Avoiding the use of AI tools that do not meet privacy or security requirements.

In short, it protects your organisation, your people, and your customers.

3. Ensuring responsible and accurate use of AI-generated content

AI tools can produce content that is inaccurate, misleading, or biased. Businesses face risks if employees rely too heavily on unverified AI-generated output.

An AI policy helps clarify:

The need for human review and verification
Expectations for accuracy, quality, and professional standards
Rules around using AI-generated content externally (e.g., marketing, client communication).

4. Managing compliance and potential breaches

Clear policies help businesses respond consistently if something goes wrong—whether it’s a privacy breach, misuse of an AI tool, or publication of incorrect information.

An AI policy can outline:

What constitutes a breach?
Who employees should report concerns to
How misuse will be managed
Steps to mitigate risks.

There are templates available that help develop an appropriate AI policy.

Acctweb

Most Valuable Industries in the World 2026

Check out which industries make up the biggest portion of the global economy.

Buy an existing business

Go through the sales process feeling prepared and informed.

Once you've assessed the value of a business and decided to buy it, you can start the purchasing process.

Make sure you understand the purchasing process so you minimise your risk and protect your investment. A lawyer or accountant can guide you through the purchasing process.

Make sure you have all the information

Read and check the documentation

The seller must provide you with:

the contract of sale
a copy of the lease
a vendor's statement or Section 52 statement (if the business costs less than $450,000)

Be wary of a seller who doesn't disclose important information, such as why they're selling, the lease, licences, permits and staff.

Check the financial records carefully

The vendor statement has information about the businesses finances.

Do 'financial due diligence' to make sure you're not overpaying. Get help from an accountant so they can make an objective appraisal of the business.

Poor business performance

Be wary of sellers who:

are subject to pending litigation
have a record of customer complaints
talk up the cash trading
drop the sale price of their products or services to bump up gross sales before selling the business

Verify the seller's claims

Insist on the right to work on the business before you enter into a binding contract, or at least before settlement. This way you can assess the truth of the seller's claims.

Watch out for sellers who:

won't allow a trial period
won't introduce you to suppliers, the landlord or estate agent
make the deal seem too good to be true
are keen to close the deal quickly
give in too easily to an offer

Read and check the contract

Get your lawyer to look over the contract of sale. Check to see if they can add the following to the contract:

a performance clause that specifies the minimum takings of the business over an appropriate period leading up to settlement
a condition that guarantees any representations made by the seller are correct (whether written or otherwise)
a restraint of trade clause that restricts the previous owner from operating a similar business within a certain distance for a number of years
a condition that transfers important existing contracts to you

Structure the payment of the purchase in stages

Work out a payment plan that allows you to pay in stages. You can retain some part of the purchase price for a certain period and, if necessary, place it in a trust with a solicitor or estate agent.

Prepare the transfer of premises

If the seller owns the business premises and is transferring the title to you, search Landata to make sure the seller has free and clear ownership of the premises.

Search for property and title certificates on Landata.

If the seller is assigning the lease to you, prepare the proposed assignment of lease. Employ the aid of a solicitor to ensure all aspects of any lease are suitable to your needs.

Be wary of:

landlords who only give short leases
leaseholders who offer the business for sale at reduced price, but then offer you the same lease at a premium.

Verify right to the business name

Use ASIC's business name register, and company and other registers to search the name of the existing business to ensure the seller has:

free and clear ownership of the business
full rights to transfer the business to you

Look out for other businesses that own rights over copyright or other intellectual property.

Search ASIC's Business names register to check that the seller owns the business name.

Search ASIC's Company and other registers to make sure the seller has a right to use the business name.

When you sign the contract

When you're ready to sign the contract:

Ensure the seller provides you with the signed contract.
Return a signed copy of the contract to the seller.
Pay the preliminary or full deposit.
Receive a receipt for the deposit from the seller

Immediately after settlement

Once the contract has been signed:

Lodge the applications for transfer of the registered business name.
Transfer all necessary permits, licences, registrations and certificates – check the Australian Business Licence and Information Service (ABLIS) to see which licences you need to transfer

Transfer the business name through ASIC.

Use ABLIS to find out what licences you need for your business.

Set your vision and goals

Even though you're planning to buy an existing business, it's essential to review the current operating processes, cash flow and marketing strategies to see if they need refreshing.

It's also good to set goals on how you want your business to look over time.

Fringe Benefits Tax (FBT) Guide – Key Checklist & Rates

To meet the Fringe Benefits Tax (FBT) deadline for the year ending 31 March (with a standard due date of 21 May), employers must identify benefits provided, calculate the taxable value, maintain records, and lodge a return.

Key Actions to Meet the FBT Deadline

Identify Benefits Provided (1 April – 31 March): Review all non-salary benefits given to employees or their associates, such as company cars, fuel, private expense reimbursements, gym memberships, or entertainment.
Calculate Taxable Value: Determine the taxable value of benefits, particularly for company vehicles using either the statutory formula or operating cost method.
Obtain Employee Declarations: Collect all necessary employee declarations (e.g., for car usage, “otherwise deductible” benefits, or living away from home) by the return due date.
Obtain Logbooks/Odometer Records: Ensure 12-week logbooks are complete and capture opening and closing odometer readings for vehicles on 1 April and 31 March.
Lodge and Pay (21 May): For self-preparers, lodge the FBT return and pay the total FBT amount by 21 May.
Use a Tax Professional: If using a registered tax agent who lodges electronically, the deadline is extended to 25 June (agent must add you to their client list by 21 May).
Lodge a Nil Return: If you are registered for FBT but have no liability, file a “Notice of non-lodgment – Fringe benefits tax” (NAT 3094) to avoid unnecessary compliance inquiries.

Crucial Reminders for 2025/2026

EV Exemption Changes: From 1 April 2025, plug-in hybrid electric vehicles (PHEVs) generally lose their FBT exemption. Check if a limited transitional rule applies to your vehicle.
Record Keeping Update: From 1 April 2024, alternative record-keeping allows using existing company records instead of employee declarations for some benefits.
Record Retention: Keep all records relating to FBT for five years.
Reporting: If the total taxable value of benefits for an employee exceeds

, report the grossed-up value in their Single Touch Payroll (STP) report.

If you cannot pay on time, contact the ATO before the deadline to discuss options, as late lodgment can result in a penalty of per 28-day period.