Selling a Business in Australia: Subscription Guide 2026

The short answer

To sell a business in Australia, get your financial records and customer data in order, value the business, find buyers, agree price and terms (deposits are usually around 10%), sign a business sale agreement, handle employee notice and entitlements, deal with tax (CGT, possible small business concessions, GST), then transfer leases, licenses and contracts and cancel or transfer your registrations.

Key takeaways

Buyers of subscription businesses look first at recurring revenue quality: churn, retention, customer concentration and how much depends on you.
Prepaid annual subscriptions are an obligation the buyer inherits. Expect them to be adjusted in the price.
A sale of a business as a going concern can be GST-free if the ATO's conditions are met, including written agreement before settlement.
CGT changes for individuals and trusts start on 1 July 2027. If a sale is likely in the next few years, model both timelines with an adviser.
From 1 July 2027, subscription-trap compliance becomes part of due diligence.

The first business I ever sold wasn't really a sale. It was an exit with my dignity intact.

I ran a results-guaranteed marketing agency. We had great clients and we were growing fast. But every dollar we earned was a one-off project. When it came time to get out, one of my best clients kindly offered to buy some of the content we'd created and take on my remaining team.

As I wrote in The Subscription Playbook, it wasn't a great financial result. But at least I could hold my head high.

Why wasn't it worth more? Because a buyer looking at a project business sees nothing guaranteed. Next year's revenue has to be won again from scratch.

A subscription business is different. The buyer can see next year coming. That's what they pay for.

This guide walks through how selling a business works in Australia, with a focus on what changes when your revenue is recurring. It's general information as at October 2026, not legal, tax or financial advice. A business sale is one of the biggest financial events of your life, so get an accountant and a lawyer involved early.

How do you sell a small business in Australia?

Business.gov.au sets out the process in ten broad steps. Here they are, condensed, with the subscription angle added.

Be sure selling is right. Know your reasons, because buyers will ask. If financial trouble is driving the sale, get advice first.
Decide who'll help. Accountant, lawyer and possibly a business broker.
Decide what's for sale. Assets, business name, IP, customer contracts, software, domain names, social accounts.
Value the business. Business.gov.au names three common methods: market comparison, net asset value and return on investment. For subscription businesses, revenue multiples matter too (see below).
Find buyers. Brokers, your network, competitors, clients, private equity.
Negotiate. Price, deposit (business.gov.au says usually 10%), settlement period, handover and staff.
Prepare the contract. A business sale agreement covering price, payment, what's included, conditions and restraints.
Manage employees. Written notice (or pay in lieu) and agreement on who pays which entitlements.
Finalize tax. CGT, GST, final BAS and tax returns.
Transfer the business. Leases, licenses and permits, then cancel or transfer your ABN and business name.

You must not mislead buyers along the way. The information you give has to be accurate, and misleading or deceptive conduct rules apply to business sales too.

What do buyers look for in a subscription business?

When someone looks at a subscription business, they're really asking one question: how much of this revenue will still be here in three years, without the current owner?

Here's what they'll check.

What buyers check	What they want to see	Red flag
MRR and ARR	Clean, ex-GST, recurring only	One-off fees counted as recurring
Churn rate	Low and stable, by cohort	A recent spike, or no data
Net revenue retention	Existing customers grow over time	Shrinking accounts hidden by new sales
Customer concentration	No client over 10% of revenue, top five under 25%	One client paying a third of the bills
Founder dependence	Team runs sales, delivery and support	Every key relationship runs through you
Gross margin	High, and stable as you grow	Margin only works if customers don't use the service
Terms and flows	Clear sign-up, renewal and cancellation	Hard-to-cancel flows, unfair terms
Deferred revenue	Tracked properly	Annual prepayments already spent

The customer concentration rule of thumb comes straight from the moat chapter of the book: no client more than 10% of revenue, and your largest five no more than 25%. Buyers apply something like it whether they say so or not. If you want to score yourself on all five moat factors, the MOATS framework walks you through it.

Buyers don't want to buy a job

In Chapter 1 of the book I describe three ways to run a business, using a coffee shop. You can work in it (making the coffee), on it (hiring and building processes) or over it (opening and acquiring more stores).

Buyers want to buy a business they can work over. If the business is you, you're asking them to buy a job, and they'll pay accordingly, or ask you to stay on for years through an earn-out.

From July 2027, compliance is part of due diligence

The Unfair Trading Practices Act 2026 adds specific subscription duties from 1 July 2027: disclosure at sign-up, prescribed notices, and an easy way to cancel, plus a general ban on unfair trading practices. A buyer's lawyer will look at your sign-up and cancellation flows the same way they look at your lease. A flow that might attract ACCC attention is a liability the buyer inherits. The full detail is in my guide to Australia's subscription trap laws.

How is a subscription business valued for sale?

Small, owner-run businesses are often valued on profit. In The Subscription Playbook I note that most one-off transaction businesses attract offers of two to seven times net profit, if they attract offers at all.

Subscription businesses with low churn, growth and a strong moat can be valued on recurring revenue instead. That can be a very different number.

The method buyers use depends on size, growth and who's buying. A competitor might pay for your customer base. A private equity buyer might look at profit and cash flow. A strategic acquirer might pay for your technology or your position in a market.

The details are in two companion guides: valuing a subscription business for the methods and drivers, and valuing an Australian SaaS business for local factors.

Should you sell the assets or the shares?

This decision affects tax, risk and what happens to your customer contracts. Here's the broad difference.

	Asset sale	Share sale
What's sold	The business assets (goodwill, IP, equipment, contracts)	The shares in the company that owns the business
Customer contracts	May need assignment or novation, depending on your terms	Usually stay with the company
Liabilities	Seller usually keeps past liabilities	Buyer takes on the company's history, so expects warranties and deeper due diligence
GST	May be GST-free as a going concern if conditions are met	Shares are generally not a taxable supply
Tax for seller	Depends on who owns the assets (company, trust, individual)	Depends on who owns the shares

Which one suits you depends on your structure and the buyer. Your accountant and lawyer should model both before you agree to either.

What happens to prepaid annual subscriptions?

This is the issue most subscription sellers don't see coming.

If customers have paid upfront for 12 months, the buyer inherits the obligation to deliver the months they haven't received yet. But you already have the cash.

Prepaid plans at settlement (illustrative)

You have 300 customers on annual plans averaging A$1,200 ex GST. On average, they have six months left at settlement.

Service still owed to customers: 300 × A$1,200 × 6/12 = A$180,000
That's recorded as deferred (unearned) revenue, a liability, in your accounts under AASB 15
A buyer will usually want that amount reflected in the deal, often as a reduction to the price or an adjustment at settlement

If you've spent that cash, you'll feel it at settlement.

This is why I tell owners to track deferred revenue properly long before they think about selling. It's covered in revenue recognition for subscriptions.

Thinking about selling in the next few years?

Get a BPAG adviser to review your recurring revenue, tax position and structure, and show you what would lift your sale value before you go to market.

Book a free profit review

Is the sale of a business GST-free?

It can be. The ATO says the sale of a business as a going concern is GST-free if all of these apply:

the buyer and seller agree in writing before settlement that it's a sale of a going concern;
the buyer is registered, or required to be registered, for GST;
the seller supplies everything needed to continue operating the business;
the seller carries on the business until settlement; and
the sale is for payment.

Miss one condition and GST may apply to the price. Get the clause into the contract, and make sure the facts match it.

What tax do you pay when you sell?

The big one is usually capital gains tax on goodwill and other assets.

The 50% CGT discount is available to individuals and trusts that have held an asset for at least 12 months, and the four small business CGT concessions can reduce the gain further, sometimes to nothing, if you meet the conditions.

But the rules are changing. Under the Treasury Laws Amendment (Tax Reform No. 1) Act 2026, gains that accrue from 1 July 2027 for individuals, trusts and partnerships move from the 50% discount to cost base indexation with a 30% minimum tax. The four small business concessions stay. I explain how it works, with a worked example, in CGT when selling a business.

If a sale is possible in the next few years, model it both ways with your adviser now.

What paperwork is needed to sell a business?

Expect to prepare, or be asked for:

three years of financial statements, tax returns and BAS;
monthly MRR, churn and retention reports, ideally by cohort;
a customer list with plan, price, start date and contract terms (anonymized until late in the process);
your standard subscription terms and any negotiated contracts;
employee details, contracts and leave balances;
leases, licenses, permits and supplier agreements;
IP ownership: trademarks, domain names, software and contractor IP assignments;
privacy and data handling policies;
screenshots or recordings of your sign-up, renewal and cancellation flows.

The selling a business checklist turns this into a working document.

What about employees?

Business.gov.au is clear on three things:

You must give written notice (or pay in lieu), including to employees who will move to the new owner.
The new owner must recognize some entitlements, but not others. Anything they don't take on, you pay.
Give the buyer up-to-date employee records, and agree in writing who is responsible for what.

Your award or enterprise agreement may add consultation duties. Get this right early. Unhappy staff are the fastest way to lose customers during a handover.

When is it the wrong time to sell?

Sometimes the best sale decision is "not yet."

Churn just spiked. Fix it and show two or three stable quarters first.
One client dominates. Diversify before you go to market.
Everything depends on you. Spend a year building the team and systems.
Your flows won't survive due diligence. Fix them before July 2027 at the latest.
You haven't modeled the tax. The 2027 CGT changes make timing a real question.

Your 12-month plan before selling

Months 1–2: Clean up your MRR reporting. Exclude GST and one-off fees. Track churn and retention monthly.
Months 2–4: Review your structure, tax position and CGT concession eligibility with your accountant.
Months 3–6: Reduce founder dependence. Document processes. Hand over key relationships.
Months 4–8: Fix sign-up, renewal and cancellation flows. Tidy your terms.
Months 6–10: Get IP assignments, contracts and records in order. Build the data room.
Months 9–12: Get an indicative valuation, decide asset or share sale, and approach buyers.

Start with a rough range. Plug your numbers into the estimator, then compare it with what you think the business is worth.

Subscription Business Valuation EstimatorEstimate a revenue multiple range from growth, retention and margin.Open the free tool →

If you're selling a software company specifically, my guide on how to sell a SaaS business covers buyer types and deal structures in more depth.

Free Subscription Profit Review

Australian business owners can book a free 30-minute review with a BPAG Accountants adviser. An honest conversation about:

whether a subscription model could work for your business
how recurring revenue could cover your fixed costs each month
how it could lift what your business is worth

Book my free review Call 1300 272 422

No cost, no obligation. General information only until we understand your situation.

Frequently asked questions

How long does it take to sell a small business in Australia?

It varies widely with the size of the business, the buyer and the deal structure. Preparation is the part owners underestimate. Getting clean financials, customer data and contracts ready can take months, and business.gov.au warns that license transfers alone can take up to 12 months. Start preparing well before you want to be gone, ideally a year or more ahead.

Do I need a business broker to sell?

Not always. Brokers help find buyers, prepare information memoranda and manage negotiations, and they're useful when you don't already know who would buy. If a competitor or client has approached you, an accountant and a lawyer may be enough. Business.gov.au recommends checking a broker's credentials before you engage one, and you should understand exactly how they're paid.

What are add-backs when selling a business?

Add-backs are adjustments to your profit that show what the business would earn under a new owner. Common examples are an owner's salary above or below market rate, one-off legal costs, personal expenses run through the business and non-recurring projects. Buyers will test every add-back, so keep evidence for each one. Inflated add-backs damage trust faster than almost anything else in a sale.

Can I stay on after selling?

Often, yes, and buyers of subscription businesses frequently want a handover period so customers and staff stay. It might be weeks of training or a longer consulting role, sometimes tied to an earn-out. Agree the length, your role, your pay and what happens if you disagree with the new owner before you sign, and write it into the sale agreement.

What happens to my customers' subscriptions when I sell?

In a share sale, the company that holds the customer contracts doesn't change, so subscriptions usually continue. In an asset sale, contracts may need to be assigned or novated to the buyer, depending on your terms. Moving stored payment details between billing accounts also needs care under privacy law and your payment provider's rules. Get legal advice on both before announcing anything to customers.

General information only, current as at October 2026. It isn't legal, tax or financial advice and doesn't consider your circumstances. Speak to a qualified adviser before acting.

Talk it through with a BPAG adviser

Free for Australian business owners: a 30-minute Subscription Profit Review on whether a subscription suits your business.

Robert Coorey, MBA

Robert is the author of The Subscription Playbook and Feed a Starving Crowd and a Director at BPAG Accountants in Sydney. More about Robert.

Sources

Facts and prices checked 27 October 2026. Spotted something out of date? Tell us.

Selling a Subscription Business in Australia: How to Get Ready, Get Paid and Get Out Cleanly