Buying or selling a small business involves more than agreeing a price. There is a sale contract, usually a lease, often a franchise agreement, and a set of tax, employee and licence issues that need to line up on one settlement day. Asset Conveyancing handles business and commercial law work for small business buyers, sellers, landlords and tenants in South Australia, Victoria, New South Wales, Queensland, Western Australia and Tasmania.
What does business and commercial law cover for small businesses?
For most small business owners, business and commercial law means the documents behind a change of ownership or premises: the sale of business contract, the lease, any franchise agreement and the structure that will own the business.
These documents depend on each other: a business sale usually cannot settle without the landlord’s consent to assign the lease, a franchise sale needs franchisor approval, and the price allocation affects GST and capital gains tax. Every matter we take on is handled by one delegated qualified professional from start to completion.
What is involved in buying or selling a business?
A business sale transfers the goodwill, plant and equipment, stock and often the lease and business name, under a sale of business contract. The contract sets the price structure, settlement date, warranties, restraint of trade and handover period.
Buyers need due diligence on the financials, lease, licences, security interests and employees. Sellers need a contract that limits warranties and makes the buyer’s conditions clear. Some states also require the seller to give a prescribed disclosure statement for smaller business sales. Our page on buying and selling a business sets out the full process.
What should you check before buying into a franchise?
Check the disclosure document, the franchise agreement and any lease before you sign, and get independent legal and accounting advice. Franchising in Australia is regulated by the Franchising Code of Conduct, which sets disclosure obligations, a cooling-off period and rules on marketing funds and end of term.
A new version of the Code took effect on 1 April 2025 and applies to agreements entered into, renewed, extended or transferred from that date. See our franchise agreements page for what the Code requires and what to look for when buying an existing franchise.
What is the difference between a commercial lease and a retail lease?
A retail lease is a lease of premises used to sell goods or services to the public, and it is governed by retail leasing legislation in each state. A commercial lease outside that legislation, such as most office and industrial leases, is governed mainly by its own terms.
Retail leasing laws require the landlord to give a disclosure statement before the lease is signed and limit some terms, such as how rent can be reviewed and which costs can be passed on. Which premises qualify differs between states. We act for both landlords and tenants on new leases, renewals, options and assignments. See commercial and retail leasing for detail.
Which business structure should own the business?
Small businesses are usually owned by a sole trader, a partnership, a company or a trust. The choice affects personal liability, tax, how easily the business can be sold later and who must sign the lease and guarantees.
- Sole trader: simple and inexpensive, but the owner is personally liable for all business debts.
- Partnership: two or more people carry on business together and each partner can be liable for the debts of the partnership.
- Company: a separate legal entity that limits shareholder liability, although landlords and lenders usually ask directors for personal guarantees.
- Trust: a trustee, often a company, runs the business for the beneficiaries, which can offer flexibility in distributing income.
Settle the structure before signing a contract or lease, so the named buyer or tenant is the entity that will trade. Your accountant should advise on tax.
Do you also need to buy or sell the premises?
If the freehold is changing hands too, that is a separate property transaction with its own GST and lease issues. Our commercial property conveyancing page covers buying and selling commercial and industrial property, and our guide to buying commercial premises covers the checks to make.
Common questions about business and commercial law
Do I need a lawyer or conveyancer to buy a business?
You should have one. A business purchase involves a sale contract, usually a lease assignment, transfer of licences, employee entitlements and GST treatment, all of which must be right at settlement. Mistakes in the contract or a missed condition can leave you with debts, an unenforceable restraint or premises you cannot use.
Is GST payable when buying a business?
Often not. The sale of a business can be GST free as the supply of a going concern if the ATO requirements are met, including that the buyer is registered for GST, the seller supplies everything needed to keep the business running and both parties agree in writing. If any requirement is missed, GST may be payable.
Does the lease transfer when a business is sold?
Not automatically. The seller’s lease must be assigned to the buyer, which needs the landlord’s consent and usually a deed of assignment. The landlord will often want financial information and guarantees from the buyer. Start the consent process early, as it is a common cause of delayed settlements.
What law applies to franchise agreements?
Franchise agreements in Australia are regulated by the Franchising Code of Conduct, a mandatory industry code under the Competition and Consumer Act 2010, enforced by the ACCC. The current Code is the Competition and Consumer (Industry Codes, Franchising) Regulation 2024, which took effect on 1 April 2025.
Do you act for landlords or tenants on commercial leases?
Both. For landlords we prepare leases and disclosure statements and handle assignments and renewals. For tenants we review the lease and disclosure statement, explain rent reviews, outgoings and make good obligations, and flag the window for exercising any option to renew.