Applying the small business restructure rollover

The small business restructure rollover (SBR rollover), announced as part of the 2015-16 Federal Budget, allows small businesses to transfer active assets from one entity (the transferor) to one or more other entities (transferees), on or after 1 July 2016, without incurring an income tax liability.

This rollover applies to the transfer of active assets that are CGT assets, trading stock, revenue assets or depreciating assets.

Entities eligible for the rollover are:

  • a small business entity;
  • an entity that has an affiliate that is a small business entity;
  • an entity that is connected with a small business entity;
  • a partner in a partnership that is a small business entity.

The rollover can be accessed when:

  • it is part of a ‘genuine restructure’; and
  • there is no change to the ultimate economic ownership of the asset.

Assets eligible for the rollover include active assets that are CGT assets, depreciating assets, trading stock or revenue assets transferred between entities as part of a genuine restructure of an ongoing business.