You CAN sell your own business..no brokers and no lawyers!

"YOU CAN SELL YOUR OWN BUSINESS!"

Buyer Enquiry Form -

Qualifying potential buyers is an important part of the sales process. We have created a Buyer Enquiry Form (found in The Business Appraisal and Marketing Kit) which provides a list of the critical questions you need to ask each and every prospect. It also has a system to measure and manage buyer enquiries, in a simple to follow format. Be wary about giving out too much company information too early in the process.

Letter of Intent -

A Letter of Intent or a Term Sheet lays out the economics of the transaction before due diligence is completed. The most important terms include, the price, the deal structure, assets and inventory, non-competing covenant, who will be responsible for liabilities, information regarding due diligence.

Create a Marketing and Advertising Plan -

Create a plan to advertise your business for sale. Identify and approach the types of buyers who may be interested in your business. Some of these may include:

- Your employees
- Suppliers
- Customers
- Competitors
- Public at large

Create buyer profiles and target your audience.

Buyer Profiles -

Start by creating a database of buyers that are most likely to be interested in buying your business. The Business Appraisal and Marketing Kit takes you through this process step-by-step, which will give you the capability you need to build buyer profiles yourself.

Target your audience -

Once you pinpoint your target audience you need to have knowledge of how to reach them. Focus your advertising in areas your target audience will read. Advertising in national newspapers is expensive but can yield good results if you choose the right newspaper; advertising in trade magazines and in local newspapers is a good way to get the message out to your industry. Online advertising is cost-effective and broadens the reach of your advertising to national and international prospective buyers.

How To Get The Most From Online Advertising -

After going to all the trouble of preparing your business for sale, and collecting the necessary information for its sale, it's important not to rush the advertising portion of the process. By posting limited, ineffective ads you may only receive calls from buyers whom you consider unqualified and unprofessional. In short, if you are not thorough in your marketing you might be wasting a lot of time, both for yourself and potential buyers.

A basic idea for most classified ads is to whet the potential buyer's appetite. You want legitimate offers, so avoid big promises and overstated claims. Try to write your ad in layman's terms; industry jargon and technical terms may discourage potential buyers.

More information is better than less.

As stated above, your goal is to whet the appetite, but in this case less information is not more. Common thinking suggests that buyers will be more likely to call if they are teased by your ad. In most cases the effect is the opposite. Buyers will bypass your business if they feel there is too little information.

More information gives buyers a sense of security: they may feel they already know a lot about you and your business just by reading your ad. If you include enough information in the description section the buyer will be pre-qualified when they contact you-this saves both parties a lot of hassle. Buyers feel more trustful of a seller with comprehensive advertising, which helps when it comes time to negotiate a sale

Serious buyers find it helpful if you put some of the following information in the detail section of your ad:

• Length of time in business, business history

• Number of employees

• Information on the geographic area surrounding the business (very important for lifestyle retreats/B&Bs). If you are selling the property with the business, be sure to include the square footage or acreage and the property's value.

• General industry info - how it's growing, changes etc.

• How you would grow the business in the future - give them a "vision"

• Include photographs of the business. Make sure they show a clean and well looked after premises. Photos on the business for sale websites get more buyers. You may think buyers would be more interested in the info behind the photos, but photos are an easy way to transmit the essence of the business to a large amount of eyes.

• True adjusted net income (know precisely how you arrive at this figure)

• Competitive analysis

• Include any business website. Is the business computerised?

• Multiple phone numbers ensure you can be reached at any time

• You may wish to offer to stay on during the transition to the new owners. If so, indicate this.

Including this information will improve the quality of the calls you receive from buyers, and you will spend much less time answering the same old questions.

Get their attention - 'featuring' your ad improves exposure

This business sale advertising site has the option to 'feature' a business on the front page. This means the ad will automatically appear at the top of listing results or in its own picture bar on each page-serious buyers will see it repeatedly and respond quicker. This option is usually worth purchasing.

This site also offers a bonus listing on a leading Australian Business Directory which is seen by hundreds of business owners and potential business operators every day. It's a chance of extra exposure which shouldn't be missed.

Newspapers -

At this stage, newspapers are still one the most effective ways to reach business buyers. But, choose well. Consider where your potential buyers may live and what type of newspapers may interest them. Target your market specifically. Get creative.

For example, take the seller who had a lifestyle business for sale on the coast of New South Wales, Australia. Thinking out of the box the seller took a fresh look at who may be interested in a lifestyle business. Corporate people looking to escape the rat race of the city and people looking for a complete lifestyle change along with an income were the two main groups the seller identified. The seller then advertised in the Financial Review, a national Australian newspaper specialising in economics, business and finance in the Australian market. Not the normal or obvious place to advertize your coastal lifestyle business. But it was a success. The seller was overwhelmed with potential buyers looking for a lifestyle change that had an income attached. The business sold to a buyer from the corporate sector.

Advertising In The Public Arena -

When making the choice to advertise on the open market there is a lot for you to consider - you do not want details of your business on the open market. The best way to avoid this is to do it yourself. The Business Appraisal and Marketing Kit has useful information that will help you to control the communication flow and minimize the risks.

Contact prospective buyers -

There is an art to contacting prospective buyers. Look at your list of buyer profiles and decide which prospects are best if contacted directly. But beware there are a few simple but critical steps you need to follow for this to be successful.

Sell to your employees -

Give your staff the opportunity to buy the business. In businesses that are highly specialised the employees may be the only potential buyers. This must be handled with the utmost sensitively and perfect timing. Again, I would stress the business owner is the ideal person to do this.

Due Diligence -

A buyer may want to examine a wide range of information prior to purchasing.

You will more than likely have the information already on hand, but things do change. It is wise to double-check any documents that potential buyers may request to view. It is advisable to set up a 'business sale ready' binder (we suggest colored red to reinforce its importance), with sections for the different types of information required for the sale. This will save a lot of time and you will appear more professional to the buyer.

Try to limit the length of the due diligence period. This is particularly important when dealing with a larger corporation. Make sure you have told your potential buyer everything - negative and positive - before they find anything. If they find any unexpected surprises they can try to negotiate the sale price downwards or may even lose interest altogether.

If all things go well during due diligence contracts of sale will be drawn up and the sale process completed.

We hope you are now feeling confident you CAN commence the process of selling your own business yourself without a business broker or agent.

If you're ready to get cracking, make sure you have The Business Appraisal and Marketing Kit to ensure no stone is left unturned and you get the best outcome.

For A Complete Sale of Business Legals Kit that will save you even more money please visit here. www.sellingbusiness.com.au

How to Write a Business Sale Information Memorandum

How to Write a Sale of Business Information Memorandum

The Information Memorandum is a marketing document used by the owner to promote their business to a potential buyer. The aim of the information memorandum is to make the business sound attractive to buyers, and also to convey all significant information to parties who are already interested in making a purchase.

A good Information Memorandum will predict all the questions a potential buyer might have about your business. It should contain a description of the business’s history, its past achievements and future prospects, as well as the particulars of its operation.

For more information relating to an Information Memorandum and having a Business For Sale please go HERE. It has invaluable insights, tips and tricks to help you get the best price for your business AND save yourself thousands of dollars in the process.

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4. Agency Agreement (non Exclusive)

5. Agreement Between Tenants In Common

6. Agreement For Hire Of Specialised Equipment

7. Agreement For Exchange Of Personal Property

8. Agreement For Sale Of Business

9. Agreement To Extend Partnership Term

10. Agreement With Website Designer

11. Amendment Of Lease

12. Assignment Of Contract

13. Assignment Of Copyright

14. Assignment Of Lease

15. Assignment Of Trademark

16. Associate Lease

17. Basic Contract

18. Brokerage Agreement

19. Business Assets Buy Sell Agreement

20. Cohabitation Agreement

21. Cohabitation Same Sex Agreement

22. Charter Agreement

23. Commercial Property Lease

24. Commercial Property Maintenance Agreement

25. Commercial Property Management Agreement

26. Commercial Property Sublease Agreement

27.Confidentiality Agreement Employee(trade secrets)

28. Confidentiality Agreement - One way

29. Confidentiality Agreement - Mutual

30. Confidentiality Sale Of Business

31. Consignment Agreement

32. Consulting Services Agreement

33. Company Consultants Agreement

34. Covenant Not To Sue

35. Contract For Sale Of Goods

36. Cost Plus Percentage Agreement

37. Creative Works Agreement

38. Credit Application

39. Deferred Compensation Agreement

40. Delivery Agreement

41. Disclosure Agreement

42. Distribution Agreement

43. Employee Invention Agreement

44. Enduring Power Of Attorney

45. Engineering Services Agreement

46. Equipment Lease Renewal Agreement

47. Equipment Maintenance Agreement

48. Equipment Rental / Hire Agreement

49. Extension Of Contract

50. Extension Of Lease

51. Fees And Royalties Agreement

52. Financing Agreement With Factor

53. Financial Statement

54. Finders Fee Agreement

55. Franchise Agreement

56. General Assignment

57. General Release

58. Guarantor Agreement

59. Heads Of Agreement

60. Indemnity Agreement

61. Independent Sub Contractor Agreement

62. Instalment Agreement To Pay Debt

63. International Distributorship Agreement

64. Joint Venture Agreement

65. Know-how Licence And Agreement

66. Last Will And Testament

67. Letter Of Demand

68. Limited Partnership Agreement

69. Limited Power Of Attorney

70. Loan Agreement - Secured

71. Modification Of Contract

72. Motor Vehicle Rental Agreement

73. Non Compete Agreement

74. Notice Of Breach Of Contract

75. Notice Of Breach Of Lease

76. Notice To Cease And Desist

77. Office Lease Agreement

78. Option To Purchase Personal Property

79. Option To Purchase Real Estate Agreement

80. Partnership Agreement

81. Partnership Dissolution Agreement

82. Permission To Release Employment Information

83. Permission To Use Copyright Material

84. Permission To Use Quote Or Personal Statement

85. Personal Property Rental Agreement

86. Prenuptial Agreement

87. Production And Manufacturing Rights Agreement

88. Promissory (installment) Note

89. Purchasing Agreement

90. Revocation Of Power Of Attorney

91. Revocation Of Will

92. Sale Of Partnership Interest

93. Sales And Product Distribution

94. Security Agreement

95. Settlement Agreement

96. Shareholders Agreement

97. Statutory Declaration

98. Termination Of Contract

99. Trademark Licensing Agreement

100. Unlimited Power Of Attorney

101. Work For Hire Agreement

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retail-tenancy-form-commercial-retail-shop-lease New South Wales NSW

Nsw Retail Tenancy Shop Leases

Many Australian state governments have expanded their concept of consumer protection to include small business consumers who are bargaining on a playing field that is far from level, against owners of big shopping centres. They seek to provide this protection by making sure that prospective tenants have sufficient information to make a sound business decision about entering into or renewing a Retail Shop Lease Agreement.

Recent amendments to the Retail Leases Act of 1994 clearly offer further protection to tenants, the Government regarding them as the less powerful party in most retail leasing transactions. As a result, the Retail Leases Amendment Act 2005 requires greater responsibility and pro-active behavior from Landlord.

The Act does not apply to a shop with a lettable area of 1,000 square metres or more but will apply to a sub-lease of space in the shop if the space which is sub-let has a lettable area of less than 1,000 square metres. A lease for a term of less than six months (without any option of the lessee to renew) is excluded in NSW. A lease for a term of 25 years or more or with a shorter term but with options to renew which (if aggregated with the original term) is 25 years or more is excluded in NSW. There is some discussion as to whether void areas, such as, for example, stairwell areas and areas adjacent to mezzanine floors, are part of the lettable areas as they are not be used to provide the retail services for which the premises are dedicated even if you pay rent on them. Be safe: use the lease even if areas such as window planter boxes or car parks might extend the actual area over 1000 sq.m.

Disclosure statements

The Law in NSW is very clear: A landlord in a retail lease must not, in connection with the lease, engage in conduct that that is misleading or deceptive to a tenant or guarantor. A party who suffers damage by reason of misleading or deceptive conduct of another party may make a claim for compensation.

If a landlord fails to give sufficient information it is guilty of Unconscionable Conduct. At the disclosure stage, Landlords and their agents will now be required to provide a copy of a retail tenancy guide to any prospective tenant as soon as negotiations are entered into. The law requires the landlord to give the tenant a disclosure statement at least seven days before entering into the lease. Tough penalties apply if you don’t, or if the statement is inaccurate.

In particular, the Act renders void lease provisions which require any tenant’s payment for contribution to fit out that has not been disclosed in a disclosure statement. In most states law entitles the tenant, if she gives you the proper notice, to withhold payment of rent until the disclosure requirements are complied with (but any rent they do pay they can’t get back).

The only way a tenant cannot end the lease in case of inadequate disclosure is where:

(a) the landlord has acted honestly and reasonably and ought reasonably to be excused for the failure concerned, and

(b) the tenant is in substantially as good a position as the tenant would have been if the failure had not occurred.

If a lease is entered into by way of the renewal of a lease on the exercise of an option, a landlord should make a fresh disclosure statement.

Minimum lease period

To have a lease of less than 5 years In NSW you need a certificate that the tenant has received independent legal advice from a lawyer or conveyancer not working for the landlord about the limited term, otherwise the lease is deemed to be extended to 5 years.

For new leases you have to provide the tenant with a copy of the unsigned agreement (with the names and addresses of the parties included), a disclosure statement, and a government – prepared information brochure, the NSW the Retail Tenancy Guide. when negotiations are commenced, and in no case less than 7 days before the lease is entered into. (That is, negotiations have to go on for 7 days, you can’t just sign a tenant up on the spot).

A copy of the proposed lease has to be provided once it has been signed. The copies can be photocopies. If you don’t supply a full copy of the lease, or don’t do it within 28 days of it being signed, or the disclosure statement is wrong, the tenant can also end the lease.

The tenant doesn't’t have to pay for fit-out contributions if the liability to pay them is not disclosed in the disclosure statement.

Landlords may be kept on their toes throughout the duration of the lease with new powerful remedies for tenants to withhold payments when information is not provided on time.

This can particularly occur in the case of providing estimates or statements of outgoings. Strata levies are also to be included in the list of outgoings.

Registered Leases

In NSW you need to register a lease of over 3 years (including options) at the Nsw Department of lands - Section 53(1) of the Real Property Act 1900 (NSW) refers to a lease for a term exceeding three years. As the minimum term of a lease subject to the provisions of s16 is 5 years, you should register all leases in NSW.

Section 15 of the Act requires the lessor, in effect, to lodge promptly for registration under the Real Property Act 1900 a retail shop lease which is required to be registered. You don’t pay stamp duty on leases commenced after 1.1.2008. See http://rgdirections.lands.nsw.gov.au/dealing/rpadealingforms/leases/lease07l

In all states, provide the lessee with a copy of the Retail Lease Agreement promptly.

You can’t demand that a tenant pay you key money in NSW.

Rental Increases

In NSW, give the tenant at least 6 months notice of a market review and keep reminding them, in writing. NSW retail leases are limited to one rental increase a year by an amount which can’t be specified in the lease, but you can have as many fixed-sum or fixed-percentage increases as you like.

Outgoings

Landlords are required to provide a written estimate of all outgoings, before entering into the lease. This estimate must also be given to the tenant one month before the start of each accounting period, of the outgoings to which the tenant is liable to contribute under the lease, (including rates, taxes and shares of things like car parking contributions) otherwise the tenant doesn't’t have to pay them. If you want the tenant to pay for a share of your expenses (other than usual outgoings – such as marketing expenses) you have to provide an audited account.

You can’t ask your tenant for capital costs or interest on your loans. In NSW you can ask for some land tax and some (but not all) legal expenses but the calculation method is somewhat complicated. If you can’t calculate it in your base rent when you negotiate the lease, leave it out. In line with other states you can ask for reimbursement in respect of any assignment of the lease or a sublease, including investigating anyone’s suitability as a tenant.

Bond

Landlords or their agents may ask for a bond, or security deposit. In NSW the bond money must be lodged with the Director-General of the Department of State & Regional Development.

The tenant has the option to provide a bank guarantee instead of a security deposit however any security deposit must be held in an interest bearing account, the interest being added to and held with the principal.

Breaches of the agreement

In the event that the tenant breaches the terms and conditions of the Retail lease agreement, the landlord is required to give the tenant a notice of breach and at least 14 days to rectify the breach prior to the landlord entering the premises.

Renewal and Options to renew

In all states, if an option for renewal is not exercised at the right time it will be lost.

The tenant can exercise an option for renewal even if there has been a breach of the lease – generally the lease will set out the provisions for exercise of the option but in NSW refer to section 133E of the Conveyancing Act 1919.

NSW Retail Tenancy Lease Agreement Available for Immediate Download Only $179.95 More Information Click Here

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Retail Tenancy, Shop Rental, Retail Leasing NSW,ACT,QLD,TAS,VIC,SA,NT,Australia

Commercial Retail Shop Tenancy leases and laws

Retail tenancy laws through out Australia have been developed to protect the interests of small business consumers and to assist in levelling the playing field for the parties involved. They seek to provide this protection by making sure that prospective tenants have sufficient information to make a sound business decision about entering into or renewing a Retail Shop Lease rental Agreement.

The type of lease you enter into will depend on a number of factors, including the premises itself and what you wish to use it for. Each state has its own Legislation or Act that defines the type of premises and whether the act will apply. Whether you are a landlord or a tenant its imperative you understand your rights and obligations under the relevant Act and honour your obligations under the lease agreement to ensure you stay out of the legal minefield.

The retail tenancy law is very clear in most Australian states:

A landlord in a retail lease must not, in connection with the lease, engage in conduct that that is misleading or deceptive to a tenant or guarantor. A party who suffers damage by reason of misleading or deceptive conduct of another party may make a claim for compensation.

Because the laws are different in each state we’ve outlined the requirements of each state on the following pages

• New South Wales
• Victoria
• Queensland
• Western Australia

Commercial Property Lease Agreement - Office Lease - Commercial Rental

COMMERCIAL PROPERTY LEASE

Whether you are going into business or want to rent a property to tenants, you are going to have to enter a lease agreement. Commercial lease agreements are necessary whenever you intend to rent a property for commercial use, or when you want to fill your commercial space with paying tenants. No matter which side of the equation you are on, there are qualities to commercial property rental agreements you will need to know before you enter one. Even if you are just looking for a simple lease of some office space or buying a property to lease it as commercial property, be ready before you take that step. Here is what you need to know:

• WHAT IS A COMMERCIAL PROPERTY LEASE? Just like any other lease, be it for a car, flat or home, commercial property leases allow landlords and tenants to enter an agreement where the tenant can use the space and pay the landlord rent for that privilege. The difference is commercial properties are for business purposes. No matter if it is a dentist’s office, a factory or a store, if you want to use a space for commerce purposes, you’ll have to enter a commercial lease.

• WHEN CAN I USE A COMMERCIAL LEASE? If you want to rent a property out for commercial purposes, or if you want to rent such a space, you’ll need a commercial lease. Because commercial endeavours usually see much higher traffic (customers, deliveries, employees.) These leases are to regulate the property and the special conditions that arise in commercial spaces. Commercial leases are distinctly different from residential leases, and you need to be aware of this.

• WHAT MAKES A COMMERCIAL LEASE DIFFERENT FROM A RESIDENTIAL LEASE? Commercial properties are intended to be used as business spaces. No matter if it’s a convenience store, a tailor shop or a factory, all of them place special demands on the owner and the tenant. Commercial leases typically have special clauses stating what activities can go on, who is permitted on the site, safety and security concerns, privacy rights and landlord access rights, as well as other business-specific clauses. Even office space leases will typically have many such clauses and conditions.

• WHAT NEEDS TO BE STATED IN THE LEASE? There is a lot that needs to go into any lease for a commercial property. Since it will hold a business, Commercial Leases often last for many years at a time. They also need to explicitly state the terms of liability, renewal, assignment rights and other issues. Commercial leases are typically much longer than residential leases, and their individual clauses are designed to meet the needs of the businesses that plan to operate on the property.

Business may be complicated. If you want to rent office space or store-front space, you need to be sure your lease gives you enough latitude so you can run your business your way. But also enough security to make sure you can’t be kicked out at will. If you are a landowner, you want to make sure you protect your property and not compromise its value by renting to a party that will cause you problems. Either way, knowing how to make a complete Commercial Property Lease is essential.

Commercial Property Lease Agreement

This Commercial Property Lease Agreement is suitable for the tenancy of most types of Australian Commercial premises such as offices, warehouses or industrial property. If you have a retail shop to lease please see the Retail Shop Leasing pages.

A solid real estate lease can protect your investment by defining your relationship with your tenants and shielding you from potential liability. In fact, a well-crafted lease should be the foundation for the ongoing relationship between you and your tenant.

Our professional Commercial Tenancy Contract with easy to follow instructions, give you the confidence that your interests are protected.

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Negotiating A Sale with Good Communication Skills

BEFORE THE DEAL

Communication, Negotiation and Bargaining Style

Decide on a negotiating style. You may be a competitor, looking only for the best deal; others are compromisers, seeking middle ground; or are you the collaborator, valuing good communication and a fair solution for both parties? Try to find which style works best for your personality.

Assessing the buyer

Your best asset in any negotiation is information. Check on the buyer by asking for a personal financial statement. There’s no point wasting time with a buyer who can’t afford your business.

AT THE TABLE

Keep It Moving

Delays and time wasted destroy deals. Once a possible buyer emerges, do everything you can to keep the deal moving. Set up meetings, provide information, and keep trying to move the buyer forward to an offer. Respond promptly to all buyer requests and proposals. If you drag out the process, the buyer will lose interest and move on.

Goals

Set goals at the start so you and the buyer are aware of what you want to get out the negotiation process. A clear plan on both sides should prevent either party from taking the lead. A good negotiator will always win on the more important issues and let the other party win on the minor ones. You can do this if you keep your goals in mind.

Understanding basic psychology may help during this process. A good tactic for the seller would be to emphasize the growth of the business, and how well the purchaser would fair in the future.

Negotiating structure

The order of negotiation should be: needs, terms, price. Write down a list of your needs in the sale of the business. Do you seek a job after the transfer for yourself or others? A discussion of needs should take place before any talk of terms or price.

Terms drive the deal. Discuss terms before price—they are more important, and will have a tremendous impact on the final price. In the majority of deals, terms decide the deal.

Price and flexibility

Have the buyer make the initial offer. You have probably already listed an asking price on your ad, so when the buyer asks “What do you really want for the business?” try not to deviate. You want the buyer himself to make up the ground between his valuation and your own.

Avoid emotions as much as possible. Banging the table and refusing to budge on matters of price are good ways to scare the buyer away. There will always be a set of terms to offset a lower price. Likewise, a higher price may be able to offset less favourable terms. Everything is flexible. Both buyer and seller should know this.

Don’t lose focus!

Nitpicking and getting stuck on tiny details are sure ways to irritate a buyer, increase legal costs and kill the momentum of a deal. Don’t pick dirt with the chickens.

KEY POINTS

Selling Price

While it may sound like a simple number to reach, the selling price may actually be divided into the following pricing sections:

• Equipment, supplies, and inventory
  


• Price for buildings and company-owned land
  


• Purchase of owners shares of stock, and that of other shareholders
  


• Non-compete agreement compensation
  

Decide on Contingencies

Conditions which have to occur before the completion of a sale are called contingencies. They might include:

• A good review of the businesses financial records
  


• Earnest money or escrow receipt
  


• Buyer qualification by their lender
  


• Lease transfer for building deemed acceptable
  


• Buyer bank financing deemed acceptable
  

Consider Covenants (Promises)

Promises made by one party to another are called covenants. They might include:

• Non-competition covenant or non compete agreement.
  


• A ‘business as usual’ promise from the new owner. The new owner promises not to distort the business by making unusual agreements, and to provide the customers with the same level of service as that under the previous owner.
  

Representations and Warranties

Warranties are reassurances made from one party to the other in a business sale. Including:

• Accuracy and completeness of financial records
  


• Accuracy of goods and products inventory
  


• Seller possesses full authority in the selling of assets, and is not in default on any contracts
  


• Leases are in order, taxes are paid, liabilities are current, and there are no liens (claims) against any assets that have not been disclosed
  


• Validity of all permits, licenses and certifications
  

Transition Issues

Transition issues include:

• Inventory or customer work that is ‘in-progress’
  


• How to deal with ‘hidden’ liabilities showing up after the closing of the sale
  


• How customer contact is to be handled, and by whom
  


• Employment of current employees
  


• Vendor contracts and contact details
  

HOW MUCH TO REVEAL, AND WHEN

It’s necessary to disclose everything about your business before receiving or accepting an offer. Let the buyer know there will be time for a books-check (due-diligence) – and that if there are problems they can withdraw. You may hold back on information that would be damaging if disclosed too early (e.g. customer information or key processes) – if the buyer needs to see such information for a valid reason, (for instance, to assess the size of the customer base) you can always change the names on the list.

Negative information should always be cleared before any offer is made. Honesty is crucial in negotiation. Despite the fact that honesty will always be reciprocated, dishonesty strips you of credibility and may compromise the entire sale.

At some point a sale of business purchase agreement will be needed. The buyer’s attorney would usually draft this agreement, which saves the seller legal fees. However, a sale of business kit and contract agreement package is available through our website, which can save a lot of unnecessary legal fees. If you have to negotiate any extra hurdles then these changes can be made in the contract as they arise. This prevents having to pay a solicitor the very costly re-drafting fee.

Next comes the Letter Of Intent (LOI), stating terms and price – the two crucial negotiating points. Make sure you are happy with the terms and price before the LOI is issued. Don’t accept a LOI and assume you will be able to do further negotiating later on.

WHEN TO CALL IT QUITS

Never negotiate with a messenger. In giving all the information to a person who can’t make a final decision, you are relinquishing most of your negotiating strength. The buyer will have the information relayed to him and can pull apart the deal as a whole, rather than point by point, as would happen in a meeting. If you have to meet with a right-hand man early on, be sure to keep some information up your sleeve for later on.

Set a condition on which you will “walk away” from the deal (price and terms). Know when to move on to the next buyer. Don’t waste your time with someone who can’t meet your needs, terms and price.

For More Valuable Business For Sale Information Please Try Here

Business For Sale? Where & How to Advertise

CREATING YOUR AD AND HOW TO MARKET YOUR BUSINESS FOR SALE

After going to all the trouble of preparing your business, and collecting the necessary information for its sale, it’s important not to rush the advertising portion of the process. By posting limited, ineffective ads you may only receive calls from buyers whom you consider unqualified and unprofessional. In short, if you are not thorough in your marketing you might be wasting a lot of time, both for yourself and potential buyers.

A basic idea for most classified ads is to whet the potential buyer's appetite. You want legitimate offers, so avoid big promises and overstated claims. Try to write your ad in layman’s terms; industry talk and technical terms may discourage potential buyers.

The More the Better.

Your goal is to whet the appetite, but in this case less information is not more. Common thinking suggests that buyers will be more likely to call if they are teased by your ad. In most cases the effect is the opposite. Buyers will bypass your business if they feel there is too little information.

More information gives buyers a sense of security: they may feel they already know a lot about you and your business just by reading your ad. If you include enough information in the description section the buyer will be pre-qualified when they contact you—this saves both parties a lot of hassle. Buyers feel more trustful of a seller with comprehensive advertising, which helps when it comes time to negotiate a sale

Serious buyers find it helpful if you put some of the following information in the detail section of your ad:

• Length of time in business, business history

• Number of employees

• Information on the geographic area surrounding the business (very important for lifestyle retreats/B&Bs). If you are selling the property with the business, be sure to include the square footage or acreage and the property’s value.

• General industry info – how it's growing, changes etc.

• How you would grow the business in the future – give them a "vision"

• Include photographs of the business. Make sure they show a clean and well looked after premises. Photos on the business for sale websites get more buyers. You may think buyers would be more interested in the info behind the photos, but photos are an easy way to transmit the essence of the business to a large amount of eyes.

• True adjusted net income (know precisely how you arrive at this figure)

• Competitive analysis

• Include any business website. Is the business computerised?

• Multiple phone numbers ensure you can be reached at any time

• You may wish to offer to stay on during the transition to the new owners. If so, indicate this.

Including this information will improve the quality of the calls you receive from buyers, and you will spend much less time answering the same old questions.

Get their attention - ‘featuring’ your ad improves exposure

Find out if your business sale advertising site has the option to ‘feature’ a business on the front page. This also usual means the ad will automatically appear at the top of listing results or in its own picture bar on each page—serious buyers will see it repeatedly and respond quicker. This option is usually worth purchasing.

This site offers featured listings as well as offering a bonus listing on a leading Business Directory which is seen by hundreds of business owners and potential business operators every day. It's a chance of extra exposure which shouldn't be missed.

FOLLOWING UP ON THE AD

Keep tabs on your advertising results

After posting, check that your ad ran properly in your chosen outlet. Track your results. Find out where each caller or emailer came across your ad. Once you have determined where the better, more qualified buyers are coming from, focus your advertising on that outlet.

If you do post your business online, make sure your anonymity is maintained and that any enquiries are made through a 'contact form' on the site or if you wish by a phone number you want to use.

The first month is critical

First impressions count. A huge number of interested buyers will see your ad when it first comes out. Having sufficient information in your ad, and being able to explain any peculiarities over the phone, will give you a greater chance of meeting with buyers.

Get back to potential buyers immediately

One of the biggest complaints from business buyers about advertisers is that they take too long to respond. Always return calls and emails promptly, within 3-6 hours as a rule. You are in competition with others, trying to sell their own business, and they are calling and emailing others while you wait.

Don't stop marketing/advertising until the check comes

Half of all offers to purchase businesses are never finalised. Keep your advertising running until you have the check from the buyer. Have backup buyers at all times. Never stop taking phone calls/emails from potential buyers: record their names in a folder and follow them up if things go south with the current buyer. Don’t let things stagnate while waiting for any one buyer.

OUTLETS

Deciding where and how to advertise

Advertising your business for sale on general online listing sites, in residential housing magazines or on television will not be the most efficient way to market your business.

The best results come from advertising in a medium which specifically targets the largest number of prospective buyers. Good advertising must cater to likely buyer groups. For this reason, advertising your business on a dedicated business sales website, and representing it in a business specific format, is the preferred option when seeking more qualified buyers. Make the entire process easier on yourself and advertise in the right medium.

Selling your business through a site catering specifically to business buyers will maximise your exposure to quality buyers in all areas local, national, and international. Limiting your advertising to one or two mismanaged or misplaced ads only exposes your business to a small portion of the buyer field. Clumsy advertising may also inadvertently alert employees, customers and suppliers that the business is for sale, a fact you may not wish to disclose early on in the sale process.

Advertising in the classified section of local or national newspapers, the trading post or specific business sales magazines is a good backup to internet exposure. Put small ads on local notice boards if you are comfortable with people knowing you are selling a business. With these methods you are getting your business in front of a group of people who may not use the internet on a regular basis.

Discretion

• Selling your business may require you to maintain a level of secrecy. You may not want your competition to attract customers concerned about a transfer of owners, nor have employees leave the business prematurely.

• Fortunately, there are ways to advertise without revealing too much about yourself or your business. Non-identifying classified ads can be placed in newspapers or online, and you can use a cell phone number or create a blind email address, rather than use the business’ contact details.

By following this advice you can improve the marketing of your business for sale. Using these techniques will give you a head start to a successful sale.

This sale of business site can offer you a great marketing opportunity AND some bonuses and services you won't find anywhere else. It is a small investment with huge potential.

Business Brokers

If your business is selling for under $2 million dollars, you may be considering using a broker. Keep in mind that for small business sales brokers are not essential and more often than not they are very costly.

A broker can place ads for you and provide advice on how to word those ads; they can also field inquiries, allowing you can take care of day-to-day business operations.

Do you really need to use a broker?

Brokers typically handle upwards of 10 business-for-sale listings at a time, and really don’t have time to do much, if any, custom marketing. What marketing they do is usually limited to running ads on business-for-sale web sites such as this one. In the end, whether you hire a broker or not, you will still have to do a lot of the selling work yourself.

Handling a sale yourself saves you the broker's commission (usually around 10 percent of the final sale price), and, since most small business sales these days are marketed on the Internet, the work a broker can do is limited. A seller will hit many buyers by advertising on top business for sale sites. Business for sale websites make sense for many small business sellers, since these sites are geared to individual buyers, which make up the majority of small business buyers.

Additionally, if you have a buyer in mind (such as an employee or relative) and feel comfortable doing the selling work with your current lawyer and accountant, you won’t need a broker.

One of the mains reasons many sellers use brokers is for their expertise in fielding responses to your ads. Responding to inquiries and steadily moving a deal forward (or opting to decline) can be difficult, and may be worth the broker’s fee . But it pays to consider improving these skills in yourself if you would like to have a lot more of the sale price end up in your own pocket.

So now you have prepared the business for sale and it's out in the public eye...now what? Well the next stage is how you deal with all the phone calls and emails you will receive. The way you are with prospective buyers is very important to making a good and lasting impression with those interested in buying your business.

For help with anything related to selling a business please go here; selling a business

How to Get A Business Prepared For Sale

Preparing Yourself and Your Business

Selling a business is one of the most crucial financial decisions most business owners will ever make. Unless you have been through the process before it can be difficult to know what to expect, and the emotions involved in selling a business you may have spent years building, can make things even harder.

As you prepare to sell your business it is important to prepare yourself as well. When it comes time to negotiate with potential buyers you should have a solid idea of what would appeal to you if you were the buyer. What makes your business different, and why? Know your businesses strong points and not-so-strong points.

When to sell?

• Timing is everything. The price you get for your business can be greatly improved by choosing the right time to sell. If sales are increasing, profits are on the up, and the business is performing well in a growing market, all signs point to a good sell.
  
  
• Readying a business for sale can be complicated and may carry added financial stress if you are worried about recouping large investments. It has been said that the best time to start preparing to sell a business is during its conception, however, if that moment has passed, allow yourself 6 to 12 months for the various stages of preparation. These include:
  
  

Valuing your business

• The best way to get the maximum sale price and ensure the buyer feels satisfied with their purchase is to attain an accurate valuation of your business. It will pay to seek professional assistance. An accountant, solicitor or corporate adviser will be able to give you an appropriate method for valuation and ensure the valuation is realistic. They can also help with identifying and marketing your business sale to potential buyers.
  

• Know as much as possible about the dynamic (e.g. day-to-day operation, contracts, stock control methods) of your business. When you meet a potential buyer being able to convey this information clearly will increase your chances for a sale.
  

General preparation / Increasing the value of your business

• Like dressing a house before its sale, making your business more attractive can do a lot for a buyer’s perception of its value. Try to streamline your business. This includes getting rid of excess stock, having any debtors under control and making sure the general appearance of the premises and staff are up to scratch.
  

• Having your accounts and the suppliers books in order will show you have made an effort to make the new owner’s transition an easy one:
  
  
• Prepare audited accounts and forecasts for the prospective buyer.
  
  
• Ready financial statements and projections demonstrating the growth and revenue potential of your business. Cash-flow projections are important for small business buyers.
  
  
• Rectify any equipment leases, return unnecessary equipment. Supplier contracts, staff contracts, etc. should be in order.
  
  
• Itemise company assets, moveable and immovable.
  
  
• Close pending customer accounts.
  
  
• Tie up all similar loose ends.
  

Make yourself redundant!

• A new owner needs to be assured that the success of the new purchase doesn’t rest solely on the previous owner’s connections and expertise. Are you reliant on a key supplier, staff member or customer? Consider what the impact would be if someone else was running your business. If the business is a house of cards dependent on your presence to stay upright, there may not be much to sell.

Comprehensive documentation and systemisation will reduce the reliance on any one employee or operator.

Create an operation manual to document precisely how best to run your business:

• Detail unwritten rules and effective techniques the business may rely on.
  

• Describe daily activities, information on any local competition, relevant industry information, and the business’ history. This document is also known as an Information Memorandum; it is the most important documentation in the sale of a business. Buyers can and will use this document to gauge their interest in the business.
  

• Consider the tangibility of your business. Is it possible to demonstrate the worth of the business to the buyer clearly and concisely? The value of solid, well-developed relationships with customers can be difficult to convey to buyers. Contracts and trusted sales staff give the business a concrete sense.
  

• Keep staff in the loop. Inform them of your plans and let them know that you will do your best to secure continued employment under the new owners, if they wish. A contented staff gives a good impression to a buyer.
  

Seeking tax advice

• Getting tax advice early will point out issues which may impact the deal down the line, this is crucial to minimising the tax burden.
  

• Seek advice on tax structures from a professional. Conditions may need to be in place for some time before becoming beneficial.
  

Preparing To Put A Business On The Market

• Planning. A business has no value other than what the buyer can create from it. There’s no point selling a hair salon to a mechanic. Who is best served to make money from your business? Cater to them. Discipline is essential. Find ways to reach the buyers who will be interested in your business. Be thorough in deciding who potential candidates may be, and equally thorough in describing the business in terms those candidates will appreciate.
  


• Use the internet. Listing with online sale of business sites and keeping your own business website gives a huge increase in market saturation and greatly improves the chance of a quick, satisfactory sale. That’s where we can help!

Once you are happy that you have prepared your business as best as you can it is now ready to put on the market. The next stage is to get your business in front of as many prospective buyers as possible.

So What Do You Do Now?

For detailed information and tips please read the next article in the series. Advertising, Marketing and Business Exposure

Due Diligence

By the end of the due diligence process, you should know about the overall financial health of the business, its prospects, competitors and the market.

Your solicitor and accountant can help, but you'll also need to investigate the business yourself. If the vendor is reluctant to provide any financial information, then warning bells should be going off.

Check financial statements
Ask yourself if the business can generate enough money to provide you with a reasonable income and make a profit. You'll need to view balance sheets, profit-and-loss statements, annual reports and any cash-flow statements of the business for at least the past three years. If the statements aren't audited, you'll need to verify the numbers against independent evidence, such as sales records, invoices, bank statements and loan documents.

You’ll also need to check the financial statements and books since the end of the last financial year to assess the profitability of recent operations and the profitability of the business in the future.

Compare the rate of growth for profit, sales and costs. Ask the existing owner whether there are new or increased costs you should anticipate. Are there any cash flow or debtor problems? Are bills being paid on time? Who are the key creditors? Know the accounts back to front before you buy.

Quick checklist:
.Check profit-and-loss statements
.Check balance sheets
.Check annual reports (if it’s a company)
.Check cash-flow statements
.Get independent evidence of finances

Check tax records
The tax returns of the business should give you an idea of its profitability. You'll need to check income tax returns and assessments from the Australian Tax Office for at least three years and reconcile the business’ taxable income and profits with its financial statements.

You want to be sure that the business’ PAYG (pay-as-you-go income tax), GST and other tax obligations, such as payroll tax, are up to date.

You'll also need to check whether the purchase of the business will be GST free (if you are buying an ongoing business) and how much stamp duty you'll be up for.

Quick checklist:
.Check income tax returns for previous three years
.Check business activity statements (BASs)
.Check payroll tax records (if applicable)
.Check stamp duty records (if applicable)

Check the assets
You’ll need to verify that any plant, equipment, fixtures and fittings are in good working order. You should do a physical inspection of the business premises and possibly seek an independent valuation. You do not want to buy obsolete facilities which can be costly to replace.

Ask for an asset list and check off physical items against it. Do a stocktake to assess the amount of stock on hand and its value as at the settlement date.

Where assets are leased by the business, obtain copies of the leases. Check that assets are insured until settlement of the purchase.

Quick checklist:
.Inspect plant and equipment
.Check asset lists
.Do a stock valuation or stocktake
.Get insurance details

Know your customers and suppliers
Get to know who your customers will be, how loyal they are and which ones are key to your business. Check the customer database (if there is one) and whether their loyalty is locked in through contracts or if future business is guaranteed. Are there any major contracts which are about to expire?

You also need to check who the key suppliers are and if they'll continue to trade with you. Ask about the business’ ability to pay its bills on time and any expected cost increases.

Quick checklist:
.Get a list or database of key customers
.Check sales contracts
.Get details of suppliers

Find out why the owner is selling
Check as early as possible why the owner is selling. If the business is badly managed or run down, the existing owner might be trying to offload it because it isn't making any money or its prospects are poor.

Check how long the owner has operated the business and how long it has been on the market. Have any offers been made and if so, what are they?

Customers, suppliers or nearby traders or competitors can be good sources of information about the business or its problems.

Quick checklist:
.Investigate the reasons
.Ask customers, suppliers, competitors
.Check for hidden problems

Check legal rights and obligations
You’ll need to check whether any government regulations cover the business and whether it has all the relevant permits and licenses which it needs to operate.

Determine your obligations to existing employees, including any leave entitlements or compulsory superannuation payments which need to be made. Check whether workers compensation premiums are up to date.

Ask about the intellectual property of the business and the business name, and whether they are protected through licenses, patents, trademarks and registrations. Will these rights be passed on with the sale?

Examine any agreements binding the business, such as leases, and ask for a copy. Check if there is a right to renew on the lease and if that option is yours to exercise. If there isn’t a right to renew, could you find another suitable location?

If you are buying a company, it’s important to check the Australian Securities and Investments Commission (ASIC) website for company details. The Australian Competition and Consumer Commission (ACCC) website can tell you if the business has been the target of any ACCC enforcement actions. Contact your state or territory consumer affairs agency for any track record of dodgy trading.

You should also check if the trader has ever been taken to court by visiting the Australasian Legal Information Institute (Austlii) website, which lists legal actions from all Australian jurisdictions.

Quick checklist:
.Review government regulations
.Check worker entitlements
.Assess intellectual property
.Check the lease

Check out the competitive landscape
You'll need to know who your competitors are. Check the growth of competitors, assess their strengths and weaknesses and how they threaten your business. Compare profitability, earnings, prices and costs if you can.

You'll also need to assess whether any new competitors are planning to start up, potentially taking away your customers or harming your profitability. The local council will be able to tell you about new developments.

Research the industry in which the business operates and whether it is growing or slowing. Find out about profit margins and industry trends. If the economy is slowing down, ask yourself how this will affect your business prospects.

You can get information from industry associations, government departments and the Australian Bureau of Statistics. You could also seek specialist advice from industry bodies, consultants or business brokers.

Quick checklist:
.Investigate your competitors
.List potential threats
.Research industry trends
.Consider economic factors

Sale of Business Mistakes

Common Sale of Business Mistakes

Common Reasons Why Businesses Don’t or Won't Sell

Trying To Sell What No One Wants

It may just be the case that your business is in such a niche style that there is no call for it. You may have loved doing it but you might struggle to find someone else with the same enthusiasm. Test the market first just to get an idea. If the local area doesn't work then advertise further afield and try tempting someone who is looking for a complete change.

Don't Overprice the Business

A business won't sell if the asking price is to high. Do some research of your area to find out what the market value is for your type of business.

Not Enough Detailed information

A lot of business sellers try to sell without giving enough detailed information to prospective buyers. Most buyers won't buy a business that has little information to show that it's a worthwhile purchase.

Giving detailed information not only encourages a buyer to buy, but it also gives their accountant and financiers good figures to work with. The best way to evaluate this is to ask yourself “what would I want to know before buying a business”? then supply more than that.

The more details you can supply the greater your chances of a successful sale.

Limited Advertsising

Whether you are selling a business yourself or using a business broker, you will have to pay for advertising. There are many ways to get great exposure at very little cost? Using an online Selling Business site is a great way to get your business in front of many potential buyers.

You can’t sell something if people can't see it!

Lack of Effort and Preparation

Without being willing to talk to prospective buyers and being prepared with answers to any questions they may ask, you won't succeed in selling your business. Obviously not all buyers will buy your business BUT you should be ready to spend time talking to people who may appear to be wasting your time

Have information ready immediately to avoid losing their interest. But don't give it all up at once, only make certain information available. If negotiations continue and the prospective buyer seems serious then you can give up some more important details.

In the end it comes down to this; without preparation, effort and time on your part then your business will not sell.

Bending the Truth

A lot of sellers go to all the effort and expense of trying to sell their business only to have it all fall apart during the due diligence period.

They have bent the truth about their business and now the buyer no longer trusts what the seller says.

Don’t try and cover up or hide anything. If there are problems fix them, if you can’t or don’t want to make sure this is reflected in the asking price

Heads of Agreement Checklist

Heads of Agreement

Checklist

• The Heads of Agreement should be dated and validly executed by both parties
  
  
• There should be an explicit statement that the Heads of Agreement is meant to be binding
  
  
• If an essential term is absent or uncertain, the agreement will be void for uncertainty or construed as incomplete, ie. the parties should have agreed the terms that are regarded as essential, for example:
  
  - In a simple Heads of Agreement to lease a building the following matters must have been agreed and should be accurately identified - the parties, the premises, the term of the lease, the rent or other consideration payable, review dates and rights of renewal
  
  
• In the above case there was express reference in the Heads of Agreement to matters "not agreed". The Court determined that the matters marked not agreed had such substantial financial implications for both parties that they were marked not agreed as an indication of their importance and were therefore essential terms.
  
  
• There should be a provision for agreement on outstanding issues to be reached by resort to an expert or an arbitrator or by another mechanism (in the above case, the Court determined that the matters not agreed were "of a kind which could not be expected to be settled for the parties by a Court or other third party" ie. the Court was unable to fill the remaining blank spaces.
  
  
• You should ensure that all documents that are referred to as "attached" to the Heads of Agreement are attached, and that the parties have initialled all amendments and the foot of each page.
  
  
• If there is a particular form of agreement to be entered into at a later date (for example, the Auckland District Law Society Lease), then this should be attached or clearly identified in the Heads of Agreement to avoid uncertainty.
  
  
• The Heads of Agreement should be clearly drafted in plain English and accurately reflect the intention of the parties with all the essential terms and conditions incorporated.

Write an employee reference letter

How to write an Employee Reference Letter

There are a few simple guidelines for writing an effective reference letter.

Firstly if you don't feel comfortable writing the reference or don't feel you can't say anything positive about the person involved then its better to tactfully decline. It is far better for the individual to find another person who can provide a positive reference for them.

References should contain the following points -

• Date
  
• Name and address of recipient if known.
  
• Salutation , for example, 'To whom it may concern', 'Dear Sir / Madam' or 'Dear 'Name'
  
• Statement of Confidentiality - if written to a specific organization for a specific purpose rather than just a general reference. - optional
  
• State the dates of employment, job title and capacity under which the individual was employed.
  
• State any other details that may be relevant eg, salary, benefits - optional.
  
• State the persons responsibilities - optional.
  
• Confirm that the individual's performance and attitude was satisfactory or exceptional.
  
• Briefly describe the individual's skills, talents, strengths - optional. Aim to be specific rather than vague.
  
• Say that you would re-hire the person - optional
  
• Offer to provide further information or provide your contact details for same - optional
  
• Signature - Yours Faithfully or Yours Sincerely if writing to a named addressee.
  
  

It's up to you how much information and detail you provide in the reference letter.

Be as factual and honest as you can and remember if you can't say something nice about someone - don't say anything at all.

If you require other Documents or Forms for managing staff please see Human Resources in the Workplace Document Template Package.

Have a Business For Sale? How do you Sell Your Business

CONTRACT FOR SALE OF BUSINESS

If you own your own business, or are considering buying an existing business, there is a lot you need to know before taking the final step. Businesses can be incredibly complex entities with multiple parties involved. If there are significant assets, debts or properties associated with the business, having accurate descriptions so all parties understand what they are and how to deal with them can be a time-consuming, exacting task. If you are considering selling your business, or if you want to buy a business, this is what you need to know:

WHO CAN SELL A BUSINESS? Anyone who owns a business (commonly referred to as a ‘vendor’) can to sell it to another party. If multiple people own a business—such as a partnership or company—anyone with an ownership interest may be able to sell that interest. Of course, there may be rules that regulate who can sell, whether they need approval of any partners or co-owners or shareholders, but if you own a business, you can sell it.

WHO CAN BUY A BUSINESS? Put simply, anyone to whom the owners wish to sell. That can be a single person, a group of people or a single person representing a group of people. Whoever wants to buy a business must agree with the seller, which should be in writing.

WHAT DO I HAVE TO DO TO SELL MY BUSINESS? Whenever you want to sell or buy a business—or an interest in a business—you will need to ensure the sales agreement is clear, and put into writing. Since businesses often involve much work, complicated financial statements, employees and other concerns, you first have to ensure everything is in order.

WHAT INCLUSIONS NEED TO BE IN THE BUSINESS SALE AGREEMENT? A lot. There needs to be a detailed explanation of every part of the business so all parties are sure of what they are selling, what they are buying, and what they can or cannot do. A buyer must be able to state how they will pay for the business, a seller must state what they are selling, and everyone has to be sure they are complying with all correct laws and legislation.

CAN I KEEP THE SALE TERMS SECRET? Of course. Confidentiality agreements and non-disclosure terms are common in Business Sale Agreements. If you are buying a business that involves the transfer of trade secrets or proprietary information, you’ll need to be doubly sure what the status of these properties will be once the sale is complete.

Whether you’ve come to the point where you want to sell your business and retire, or if you want to start a new career and believe buying a business is the way to go. The sale of a business is a complicated matter for all parties involved. Even a small business often has significant issues involved with its transfer, and everything needs to be clear to ensure everyone understands the terms. A good Sale of Business Agreement leaves nothing in the dark, and it allows everyone to be certain of their position.

How the document review service works.

How the 'Document Review Service' works. (CLICK IMAGE FOR FULL SIZE)

“How You Can Prevent The ATO And A Court Of Law From Seizing Your Assets!”

Your company SHIELD is an invaluable asset. It's especially vital to you during a business crises.

But this protective shield can easily be pierced.

If this occurs, your liability protection (together with all of the tax benefits) you have through owning a company could be totally wiped out! All it takes is for the Australian Taxation Office to conduct an investigation of your company records.

And the ATO is stepping-up its inspection of company records in the financial year!

After reviewing your records, they may find inconsistencies and errors unbeknown to you. If you haven't kept complete and accurate minutes (and other forms) NOW required by federal law... your troubles could start right there and then!

Do you own a proprietary limited company?

If you do then you should use the Company Documents Software™ Why? Because it keeps your registered company totally organised, and out of accounting, collection and legal troubles.

IRONCLAD COMPANY DOCUMENTS

This software needs ONLY a 5-minute investment in your company every month and you're done.

Presto! You're now in legal and statutory compliance.

These days a company is the target of the ATO, State and local taxing authorities, employees and unreasonable customers. To keep proper (and accurate) company records is not only important but it's absolutely crucial! You no longer have to pay high fees to an accountant or solicitor to get your company records in order because this company forms software can do it ALL for you with incredible accuracy and speed.

Associate Lease Agreement, Salary Sacrifice, Salary Packaging

Associate Leases: A Guide for Employers and Employees

You have probably heard of salary packaging or salary sacrifice, a flexible remuneration scheme where employees agree to forgo part of their salary (thus the term salary sacrifice) in exchange for certain non-cash benefits. An associate lease is one of the ways through which employers can provide their employees with car benefits under a salary packaging agreement. With an associate lease in place an employee can reduce their taxable income in exchange for a motor vehicle.

What is an Associate Lease?

An Associate Lease is a lease rental arrangement whereby an Associate of the employee (eg partner, spouse) owns the motor vehicle and leases it to the employer. The motor vehicle is then provided to the employee on a fully maintained basis.
Once the lease is in place, the motor vehicle is recognised as an Employer provided motor vehicle for both the purposes of the Income Tax Assessment Act and the Fringe Benefits Assessment Act.

The Benefits of Associate Leases

The Associate leases arrangement provides two key benefits :
i) Lease payments are paid as income to the associate who would generally be in a lower tax bracket than the employee.
ii) Additionally all of the running and maintenance costs are paid for and claimed as a deductable expense by the employer.
iii) Employee forgoes income in exchange for car benefits thereby reducing tax liability

An associate lease is thus a salary sacrifice arrangement that is very similar to a novated lease agreement. However, in an associate lease, the employee's associate is the owner and thus the lessor of the vehicle provided by the employer to the employee whereas, in a novated lease, a finance company is the lessor.

However convoluted it may seem on the surface, an associate lease is simply an arrangement in which the employee through his associate leases the employer his or her existing car so that the employer can provide him or her with car fringe benefits, which he or she pays for by sacrificing part of his or her future salary.

Under an Associate Lease Agreement, the associate is liable to pay taxes on the lease payments received. However, if the associate in the agreement happens to be someone who has no or quite low income (e.g. adult child attending university), then income tax savings can still be considerable. After all, the marginal tax rate would still be lower than the rate that the employee would have to pay had the amount been on his or her assessable income. The depreciation allowance for the first year also leads to further reduction in the associate's assessable income.

Tenants in common agreement allows for co ownership of property

Tenants in common

The soaring price of real estate makes getting into the property market hard. The possibility of pooling resources with friends and family to achieve this is appealing.

The question is…How?

The answer could be to become ‘tenants in common’.

Tenants in common is a type of joint ownership of property. This type of co ownership is most suited to investment type properties where each ‘tenant in common’ is able to deal with their interest individually. It is vital to all involved that the purchase is documented and regulated by a tenants in common or co-ownership agreement which can outline every aspect of the purchase.

There can be as many individuals as you like holding a share of the title to a single piece of real estate. The shares in this type of agreement do not have to be equal meaning you can have multiple ‘owners’ with varying shares in the property. These shares are generally decided at the time of purchase, but can be altered at any time, provide all parties agree to the change.

Each shareholder is able to leave their share of ownership in their will to anyone they choose and the other tenants in common have no legal claim to it. Each tenant in common has the right to deal with their share of the property separate from the others. The share of a tenant in common is known as an “undivided” share.

An initial outlay or ‘capital’ is needed and then an amont (stated in the agreement) is paid into a ‘revolving’ fund on a pre determined schedule (ie, weekly, fortnightly,monthly). This fund covers all expenses incurred by the property and if these exceed available funds then each party must put in extra money.

What if I want to sell my share?

After an amount of time set out in the agreement, a party can sell their shares. They can be sold to anyone but must be offered to the other parties in the agreement first (known as the ‘first right of refusal’). If the sale is accepted then the selling party will be responsible for the cost of valuation and all of the other costs incurred.

These are the basics of becoming ‘tenants in common’. The finer details are all covered in your ‘tenants in common’ agreement.

It is a viable and sound way to enter the property market without having to find all the money yourself. Just do it right at the beginning and you can be on the property market ladder sooner than you might think.As long as you have made a ‘tenants in common’ agreement and all parties have signed and agreed then there can be no arguments in the future.

Creating A Financial Property Settlement Agreement When A De Facto Relationship Has Broken Down.

How to do Property Settlement When A De Facto Relationship Has Broken Down.

Before the right to create Financial Agreements (FAs) was extended to same-sex and de facto relationships, when such a relationship had broken down, both parties would have had to prepare themselves for some long-winded and tedious litigation through the Supreme Court. Thank goodness, this has now all been changed with the introduction of section 90UD of the Family Law Act 1975 which specifically entitles people in de facto relationships to agree upon what they consider to be a fair distribution of property and financial resources once the relationship has broken down.

Effectively, this now places de facto agreements in the same category as is already enjoyed by married couples. It means that same-sex relationships are apportioned with similar rights to heterosexual couples and this will be viewed as a welcome move by many gay rights groups that have been concerned and campaigning over these issues.

How Would You Go About Creating A FA In These Circumstances?

If a de facto, or same-sex relationship has broken down irretrievably, s.90UD of the 1975 Act sets out that the following procedures would need to be followed in order for a court to recognise and apply a financial agreement. These are as follows:

They would need to ensure that both parties seek professional and qualified legal advice. This is imperative and it should help to ensure that each party’s unique situation is evaluated and legally commented upon. If gross unfairness can be identified within the agreement as it stands, the legal advisor will point this out to the relevant partner and they will then only go ahead and sign once they know exactly what they are agreeing to and/or possibly compromising.

A certificate must be obtained from the applicable legal professional which will attest to the fact that this requirement has been satisfied. It would then need to be added as an ‘annex’ to the main written legal document which will make up the FA.

The FA will need to specify the extent of any relevant spousal maintenance to be provided. It will need to be signed by both people and a copy will be retained by each.

Provided all of the steps have been taken above, the court should not scrutinise the FA to ensure that it is just and equitable. The court would only tend to set a FA aside if there were fundamental flaws with the documents (e.g. the FA had been created in a fraudulent manner).

It is also important to note that a person can only enter into a FA if they are not already party to such an agreement with another person.

Swifter Resolution At The End Of A Relationship

This type of post nuptial agreement should help to ensure that any financial matters are dealt with far more smoothly than they may otherwise be. Granted, some time would be required on both sides to conceive the financial agreement, but once a settlement is agreed upon, the FA will provide a far quicker resolution to the question of who gets what.

Of course, to a large extent, at the end of any relationship and at a time when communication between both parties may not be as amicable as it once was, a lot will depend on how quickly an agreement can be settled. Nevertheless, it would probably end up being more prudent and cost effective for the parties to resolve the property and financial implications in this way.

Whatever actions the members of a de facto relationship elect to take when things have broken down, the fact remains that Australian law now provides them with these choices. Gone are the days where there was only very limited avenues that could be pursued in order to resolve such issues. Such de facto agreements now exist to realise a swifter resolution to the distribution of property and financial resources.

Our Financial Agreement Review Service is available as an option with this agreement.

Separation Financial agreement kits are available for immediate download only $129.95

State by State Financial Agreements for every relationship

Below is a State by State list of all the available (prenup, postnup, defacto, cohabitation, separation, divorce) financial agreements.

NSW FINANCIAL AGREEMENT KITS Available for immediate download 90UB Pre De facto financial agreement kit a relationship before Cohabitation 90UC De facto financial agreement kit for defacto partners who already Live Together 90B Prenup / prenuptial financial agreement kit for a couple Getting Married 90C Post nuptial financial agreement kit those married Staying Together 90C Separation financial agreement kit for married and Separating 90UD Separation financial agreement kit for De Facto partners after a relationship ends 90D Financial agreement for a Divorce

QUEENSLAND FINANCIAL AGREEMENT KITS Available for immediate download 90UB Pre De facto / pre cohabitation kit for a relationship before Cohabitation 90UC De facto / cohabitation kit for defacto partners who already Live Together 90B Prenup / prenuptial kit for a couple Getting Married 90C postnup / Post nuptial kit for those married Staying Together 90C Separation financial agreement kit for married and Separating 90UD Separation financial agreement kit for De Facto partners after a relationship ends 90D Financial agreement for a Divorce

ACT FINANCIAL AGREEMENT KITS Available for immediate download 90UB Pre De facto / pre cohabitation kit for a relationship before Cohabitation 90UC De facto / cohabitation kit for de facto partners who already Live Together 90B Prenup / prenuptial kit for a couple Getting Married 90C postnup / Post nuptial kit for those married and Staying Together 90C Separation financial agreement kit for married partners Separating 90UD Separation financial agreement kit for De Facto separation after a relationship ends 90D Financial agreement for a Divorce

NORTHERN TERRITORY FINANCIAL AGREEMENT KITS Available for immediate download 90UB Pre De facto/ pre cohabitation kit for a relationship before Cohabitation 90UC De facto/ cohabitation kit for defacto partners who already Live Together 90B Prenup / Prenuptial kit for a couple Getting Married 90C Postnup/ Post nuptial kit for those married and Staying Together 90C Separation financial agreement kit for married partners Separating 90UD Separation financial agreement kit for De Facto partners after a relationship ends 90D Financial agreement for a Divorce

TASMANIA FINANCIAL AGREEMENT KITS Available for immediate download 90UB Pre De facto / pre cohabitation kit for a relationship before Cohabitation 90UC De facto / cohabitation kit for defacto partners who already Live Together 90B Prenup / prenuptial kit for a couple Getting Married 90C postnup / Post nuptial kit for those married and Staying Together 90C Separation financial agreement kit for married partners Separating 90UD Separation financial agreement kit for De Facto partners after a relationship ends 90D Financial agreement for a Divorce

SOUTH AUSTRALIA FINANCIAL AGREEMENT KITS Available for immediate download Domestic Relationship Agreement for hetero partners only before or during Cohabitation made under section 5 Domestic Partners Property Act 1996 - not suitable for Same – sex relationship 90B Prenup / prenuptial kit for a couple Getting Married 90C postnup / Post nuptial kit for those married Staying Together 90C Separation financial agreement kit for married and Separating 90UD Separation financial agreement kit for De Facto Separation after a relationship ends 90D Financial agreement for a Divorce

VICTORIA FINANCIAL AGREEMENT KITS Available for immediate download 90UB Pre De facto / pre cohabitation kit for a relationship before Cohabitation 90UC De facto / cohabitation kit for defacto partners who already Live Together 90B Prenup / pre nuptial kit for a couple Getting Married 90C postnup / Post nuptial kit for those married Staying Together 90C Separation financial agreement kit for married and Separating 90UD Separation financial agreement kit for De Facto partners after a relationship ends 90D Financial agreement for a Divorce

WESTERN AUSTRALIA FINANCIAL AGREEMENT KITS Available for immediate download Pre De facto / pre cohabitation kit for a relationship before Cohabitation made under s 205ZN the Family Court Act 1997 De facto / cohabitation kit for defacto partners who already Live Together made under s205ZO the Family Court Act 90B Prenup / pre nuptial financial agreement kit for a couple Getting Married 90C postnup / Post nuptial financial agreement kit for those married Staying Together 90C Separation financial agreement kit for married and Separating De facto separation financial agreement kit after a relationship ends made under S205ZP the Family Court Act 90D Financial agreement for a Divorce