Success in Succession

Last week I attended the Taxation Institute of Australia National Intensive Conference on issues surrounding succession for family businesses.

The TIA conference is always an absolute ripper and covers the various aspects of the particular technical issue at a very in-depth level.  The presenters are some of the best and most highly qualified in Australia and the attendees tend to be the “leaders” in tax from around the country.

Anyway, back to this year’s topic.  The basis of the conference was to explore in depth aspects surrounding the issues of succession.  There were papers presented on how to deal with Trusts, superannuation funds, insurance proceeds and the impact of divorce on planning for succession. 

On review of the presentations and papers, it highlighted to me just how complex this area is and the issues that arise from seemingly “simple” transactions can have profound effects on the next generation from both operational and taxation perspectives.  There are a lot of practitioners out there who profess to understand the detail about succession.  Unfortunately, from my discussions with various delegates at the conference, they get to see the messes that are created when well-meaning but not-up-to-speed advisers create succession plans for clients.  The “clean up” process can be lengthy, costly and messy.

Any succession planning process needs to be considered in light of a wide range of factors.  To enable a successful succession, a business needs to brief competent and experienced professionals in the accounting/tax, business advisory and legal areas.  This is especially the case where there are trusts, superannaution funds and possible relationship breakdowns involved.  This latter issue is especially important due to the increased powers of the Family Court with regard to reversing transactions that had been effected as part of the succession where there is a marriage breakdown subsequent to the succession.  The potential ramifications from this aspect alone can be horrific from a taxation perspective.

So, if you’re looking at succession for your business (and most businesses should be doing this), care needs to be exercised in selection of your advisers.

Surround yourself and your family with the “right” advisers to ensure your success in succession.  If you don’t it is highly likely that you’ll end up as a Case Study at a future conference!

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  • Reply

    First of all I would like to say fantastic blog! I had a quick question that I’d like to ask if you do not mind. I was curious to find out how you center yourself and clear your thoughts prior to writing. I have had a tough time clearing my thoughts in getting my ideas out there. I truly do enjoy writing but it just seems like the first 10 to 15 minutes are usually lost simply just trying to figure out how to begin. Any recommendations or hints? Kudos!

    • MTA Optima


      It can be difficult! Mostly I look for opportunities that come up during our work here at the business – a lot of the issues we deal with a relevant across a range of businesses and those that have some particular value are the ones that we look to post (have a look at my post later today).

      Thanks for your post.

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