Buying a Business With the Freehold or on a Lease: What Changes
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Business Acquisition · Commercial Property · Buyers
Two buyers can pay the same price for the same trading business and end up with different transactions because one takes the freehold and the other takes over a lease. That choice changes what you own, how finance is split, what due diligence is added, who can delay settlement, what has to be ready on day one, and what you can sell later.
Quick Answer
Buying a business with the freehold means you buy two assets at once: the trading business and the premises, so finance, valuation, due diligence, tax and settlement all run on two tracks. Buying on a lease means you buy the trading business and take over a lease instead, so the remaining term, landlord consent and assignment process become part of the deal. This guide covers the general business purchase, not the accommodation tenure comparison and not buying premises you already lease.
Also called: buying a business with the freehold, buying the business and the building, a business-only purchase on an assigned lease, buying a business with property.
Where you are in the deal
- Still comparing two listings. One says freehold, one says business only on a lease. Start with what actually changes and the comparison table.
- About to make an offer. Before price becomes the whole conversation, work through the extra property due diligence, then decide what the finance clause has to cover.
- One vendor is offering both shapes. The choice is a funding and capital-allocation question before it is a preference. Read how the two credit legs are assessed, then who should own the premises.
- Already under contract with a finance clause running. A freehold deal can have a business credit leg, a property credit leg and one settlement date. Go to valuation, finance-clause and settlement risk.
- The lease or the landlord is the problem. Consent can sit on the critical path of a business-only purchase. Go to landlord consent.
- Settlement is close and you are thinking about day one. The seller being paid is not the same as the business being operational. Go to the morning-after-settlement checklist.
- You want the freehold but cannot fund both right now. There are several deal shapes worth discussing, set out under what to do when you can only fund one.
- You already run the business and the landlord is now selling. That is a different transaction with different mechanics: buying your premises from your landlord.
What actually changes when you buy the freehold with the business?
Taking the freehold with the business changes six things at once, and they move together rather than one at a time. You are not adding an optional extra to a business purchase; you are turning one transaction into two that happen to settle on the same day. Six specific things change.
- How it is funded. The property and the trading business are usually assessed as separate credit legs, because a lender does not read a building and a trading business the same way.
- What secures it. With the property in the deal the land carries the debt. Without it the lender is secured against the buying entity, its assets and what you already own.
- What sets the loan term. With the property, the property facility is assessed against the asset and lender policy. Without the freehold, the secure occupation left in the lease can become a practical limit on the business funding term.
- How the price is split. The contract has to allocate the price across land, plant, stock and goodwill, and that allocation feeds into the valuation, duty, GST and tax analysis rather than leaving everything inside one headline price.
- What you inherit. Both shapes can hand you employees, supplier contracts, licences and financed plant. On a business-only purchase, the lease and landlord-consent process can sit on the critical path as well.
- What you are holding when you exit. Sell a business you own the premises of and you can sell one, the other, or both. Sell a business on an assigned lease and the lease goes with it.
Which of these are you actually looking at?
Four different transactions get searched with almost the same words, and only two of them are this page. Check which one you are in before you read any further.
| What you searched or were told | What it usually means | Where it is covered |
|---|---|---|
| Buying a business with the property | The trading business plus the freehold it operates from, bought together and usually settling on the same day | This guide |
| Buying a business without the property, or business only | The trading business plus an assignment of the existing lease. It does not mean buying without a deposit, and it does not mean buying without security | This guide |
| Freehold going concern versus leasehold | Accommodation vocabulary, used for motels, parks and management rights, where tenure is a different comparison run on a different valuation basis | Tenure comparison for accommodation businesses |
| Walk in walk out | A listing shorthand for taking the business and its plant as it stands. It says nothing about whether the land is included, and nothing about what the lease says | Glossary entry on the shorthand |
| Buying the shares in the company rather than the business | You buy the entity itself, so the business, the plant, any lease and any land stay exactly where they are and nothing is transferred at all. Almost everything on this page reads differently, because there is no asset sale, no lease assignment and no transfer of business | Named here so you can tell which one you are in. The mechanics are a question for your solicitor and accountant |
| Buying the premises you already lease | You already run the business and your landlord is now selling the building to you, so there is no business sale and no assignment at all | Buying your premises from your landlord |
The rest of this guide takes those six in order. It is written for the general trading purchase: a workshop, a childcare centre, a medical practice, a manufacturer, a suburban retail shop. If you are looking at an accommodation asset, the tenure comparison there runs on different vocabulary and a different valuation basis, and it is covered separately in the tenure comparison for accommodation businesses. If you want the acquisition mechanics that apply whichever shape you choose, from add-backs to working capital, they sit in the parent guide to funding a business purchase.
Freehold here means what it means on the title: you hold the land, not a right to occupy it granted by someone else. That distinction is the whole page. The market you are buying into is large and mostly small, which is worth holding in mind before you assume your deal is unusual.
The market you are buying into
General information only. These are national counts published by the Australian Bureau of Statistics and are context for the market, not financial advice and not a statement about the business you are looking at.
The useful question is not whether your transaction is common. It is whether the freehold is genuinely part of the sale, because that decides whether you are diligencing and funding one operating business or an operating business plus a property. If you want the wider picture of how business owners fund growth and acquisition, start at the business owners finance hub.
What extra due diligence do you need when the freehold is included?
If the freehold is included, you need two due-diligence tracks: one on the trading business and one on the real estate. The business review still covers financials, contracts, staff, licences, stock, equipment and liabilities; the property review adds title and property searches, zoning and permitted use, planning and building approvals, physical condition, environmental and legacy-use risk, flood and fire exposure, access and easements, ownership costs, insurance and the lender's valuation.
Australian government guidance makes the same distinction in practical terms. Business Queensland's business-purchase due-diligence guidance includes contracts, financial records, leases, licences, equipment, town planning, flood and fire zoning and the condition of the premises. Business Victoria says a buyer of business premises should inspect the property and check zoning, workplace safety, planning and building permits.
| Property check | What you are trying to establish | Who usually leads it |
|---|---|---|
| Title and property searches | What land and improvements are actually being transferred, and what registered interests or property records need to be understood before settlement | Your solicitor or conveyancer |
| Zoning, permitted use and approvals | Whether the business can keep operating from the site as intended and whether relevant planning or building approvals need attention | Your solicitor, local authority and any planning adviser needed for the site |
| Physical condition | Whether the structure, services, fitout or obvious repair work changes the economics of taking the freehold | An appropriately qualified building or property specialist |
| Environmental and legacy-use risk | Whether current or past uses of the site or nearby land indicate contamination, hazardous-material or other environmental risk that needs specialist investigation before you own it | Your solicitor plus an appropriately qualified environmental or hazardous-material specialist where the site history or inspection gives a reason to investigate |
| Flood, fire, access, easements and notices | Whether hazard exposure, legal access, easements, notices or other site constraints affect continued use, insurance, future works or the value you are relying on | Your solicitor, local authority and insurer, with a specialist where the property or location requires one |
| Property valuation | What the lender is prepared to rely on as security value, which may not be the same as the contract price or the business valuation | The lender's valuer for credit purposes; your own adviser if you want an independent view of price |
| Rates, insurance and ownership costs | Which premises costs move from a landlord or lease budget onto you as owner, and what has to be allowed for after settlement | Your accountant, solicitor and insurer |
| Fixtures, fitout and financed plant | Which items form part of the land, which are loose business assets, which belong to somebody else and which carry a security interest | Your solicitor, accountant and the asset/PPSR review |
A lender valuation is not a substitute for your own legal and physical due diligence. It answers the lender's security question; it does not answer every question about the property you will own.
Sources: Business Queensland, Due diligence when buying a business; Business Victoria, Buy a business premises; and Environment Victoria, Property and contamination, read live 26 August 2026. The environmental source is Victorian and illustrates the extra investigation that can arise from site history; requirements differ by property and jurisdiction. General information only, not legal, environmental or property advice.
Do you need two loans to buy a business and its premises?
A purchase that includes the freehold is commonly assessed as two separate credit legs: one against the property and one against the trading business. The final facility structure can still include asset finance or working-capital funding as well, so the useful point is not the literal number of loan accounts; it is that the building and the business are separate credit decisions inside one settlement.
The property leg is secured by the land and assessed on what the property is worth, how readily it could be re-let or resold, and how specialised the building is to the business currently in it. A generic industrial unit and a purpose-built processing facility are not the same security even at the same price. The business leg is secured by the buying entity and its assets and assessed on trading performance, how much of the price is tangible, and whether the figures reconcile to what was lodged.
The practical consequence is that the two legs can be approved on different timelines, carry different conditions, and fail independently. A property valuation that lands short does not automatically kill the business leg, and a business leg that stalls on unreconciled figures does not automatically kill the property leg, but a single settlement date means either one can hold up the whole thing. That is the reason a buyer taking the freehold needs to start both conversations at the same time rather than in sequence.
This guide deliberately does not re-derive the property side. What a commercial purchase needs in deposit, equity and cash at settlement is a separate question with its own answer, and it is covered in full in what a commercial property purchase needs up front and in the mechanics guide to how commercial property loans work. What this page does is the comparison those pages do not make.
| What changes | Freehold included | Business on an assigned lease |
|---|---|---|
| What you acquire | The trading business plus the land and buildings | The trading business plus the right to occupy the premises under the lease |
| Finance | Property and business credit legs are assessed separately; other facilities may sit beside them | There is no property purchase loan for the premises, but the acquisition can still use more than one business or asset facility |
| Primary security question | The property leg looks to the land and buildings; the business leg looks to the buying entity, its assets and the wider security package | The lender looks to the business, its assets, guarantees and any additional security required for the deal |
| What can limit the business funding term | Property and business policy are assessed separately; there is no third-party lease expiry on the owned premises | The secure occupation left in the lease can become a practical limit on the business facility term |
| Extra due diligence | Business due diligence plus title, zoning/use, approvals, physical condition, property costs and valuation | Business due diligence plus lease term, options, rent/outgoings, assignment, make-good and landlord-consent conditions |
| External dependency before settlement | The lender's valuation and property/legal searches sit on the critical path | Landlord consent and the lease-assignment process can sit on the critical path |
| Premises responsibility after settlement | You carry the ownership costs and maintenance responsibilities that the owner of the building has | You carry the rent, outgoings and tenant obligations set by the lease |
| Exit | You may be able to sell the business, the property, or both, depending on how you structure the exit | A later sale has to work with the remaining lease term and the next assignment or replacement lease |
No deposit or loan-to-value figure appears in this table by design. Both legs are priced case by case and a band quoted without the contract and the lease in front of it is not information.
What happens if the property valuation is below the contract price?
A lower lender valuation can reduce the amount the lender is prepared to advance against the property, which can increase the cash, equity or other support required at settlement. It does not automatically decide the separate business credit leg, but because both parts have to settle together a shortfall on the property side can still delay or stop the whole purchase.
The practical protection is timing: get the valuation ordered early enough that a shortfall can be dealt with while the finance condition is still alive, not after the contract has become unconditional. If you want the property-side detail, read what a commercial valuation actually tests.
What has to happen between signing and settlement
Two facilities inside one contract means two credit decisions, two evidence packs and one deadline, and the finance clause in the contract is what that deadline is called. The sequence below is the order things actually have to happen in, not the order they appear in the contract, and the items that most often move a settlement date are the ones that depend on somebody outside the transaction.
| Step | Which leg it sits on | Who controls the timing | What it holds up if it slips |
|---|---|---|---|
| Both applications lodged together | Both | You and your broker | Everything downstream, because the legs run in parallel rather than in sequence |
| Valuation instructed and returned on the property | Property | The lender and the valuer | The property leg, and the cash you need at settlement if it lands short |
| Business financials reconciled to lodged returns | Business | The seller and their accountant | The business leg, and it is the most common source of unplanned delay |
| Landlord consent to the lease assignment | Business only purchases | The landlord | The whole transaction, and it is outside your control and the lender's |
| Searches on title and on the register of personal property | Both | Your lawyer | Settlement, if financed plant or an encumbrance turns up late |
| Licence and permit transfers or fresh applications | Business | The issuing authority | Your ability to trade from day one, which is not the same as settling |
| Stock take and settlement adjustments | Business | Both parties | The final figure where the contract provides for a settlement stocktake or adjustment |
No number of days appears in this table by design. Finance clause periods are negotiated deal by deal and vary by state, by contract and by how much of the evidence already exists. Ask for the period you actually need before you sign, not after.
What should the business sale contract be conditional on before settlement?
Finance is only one of the things that can decide whether a buyer is actually ready to complete. Common conditions to discuss with your solicitor include satisfactory finance and due diligence, an acceptable lease or landlord consent where the premises are leased, required licences or third-party consents, clear transfer of the assets and security releases, and property due diligence where the freehold is included. The important drafting question is not just what the conditions are; it is whether their deadlines, evidence requirements and consequences line up before you become unconditional.
| Condition to discuss | Why it can hold up the purchase | What needs to be clear |
|---|---|---|
| Finance | The lender may approve one credit leg while a valuation, business leg or other condition is still outstanding | The required amount, the relevant facility or facilities, the deadline, notice process and what counts as satisfying the condition |
| Business and property due diligence | Financial, legal, operational or property findings can change the price, structure or willingness to proceed | Scope, access to information, the decision deadline and what rights exist if a material issue is found |
| Lease or landlord consent | A business-only buyer may not have a secure right to occupy the premises even if finance is approved | Assignment versus new lease, term and options, landlord conditions, security requirements and the consent deadline |
| Licences and key third-party consents | Some permissions, supplier arrangements or customer contracts do not transfer simply because the sale contract says they do | Which approvals must exist before settlement and which can validly be completed afterwards |
| Title, PPSR and asset releases | The seller may not be able to transfer an asset free of an existing mortgage, finance interest or other registered claim | What searches and releases are required and who is responsible for obtaining them before completion |
| Stock, adjustments and handover | The final amount payable and the ability to trade on day one can still move after the headline price is agreed | How stock and adjustments are calculated, what is delivered at settlement and what the seller must hand over |
This is a transaction checklist, not a standard set of legal conditions. The right conditions and the consequences of not satisfying them depend on the contract, jurisdiction and transaction.
Sources: Business Queensland, Completing the purchase of a business, which says an offer can be subject to matters including finance or a satisfactory lease and that purchase contracts contain buyer and seller conditions with set dates; and Business Queensland, Due diligence when buying a business, read live 26 August 2026. Have your solicitor draft and interpret the actual conditions.
What happens if your finance is not approved by the finance clause date?
Do not assume a finance clause automatically lets you walk away if a lender has not approved the deal. What the clause protects depends on its wording, the contract and the jurisdiction, and the notice, evidence and timing requirements can matter as much as the lender's decision itself.
On the property side in Victoria, the Legal Practitioners' Liability Committee says a subject-to-finance clause requires the purchaser to comply with the loan details and timeframes written into the contract before relying on the clause to end the deal. That is a Victorian land-contract example, not a national rule, but it shows why the clause has to be treated as a legal condition rather than a general safety net.
- Have your solicitor identify the actual deadline and notice mechanism. Do this when the contract is being negotiated, not when the date is expiring.
- If approval is delayed, ask about an extension before the deadline. Whether it is available is a negotiation and depends on the contract and seller.
- Do not confuse pre-approval with satisfying the contract condition. The property, valuation and final credit conditions may still have to clear.
- On a business-only deal, landlord consent and finance can run on separate clocks. Clearing one does not necessarily clear the other.
- If you cannot rely on the clause, the consequences are a contract question. Do not assume the deposit position or default consequences without legal advice on the actual agreement.
Source example: Legal Practitioners' Liability Committee, Subject to finance requires strict compliance, read live 26 August 2026. The source concerns Victorian contracts for the sale of land. Business-sale contracts, other jurisdictions and special conditions differ. Get your own solicitor to read the clause before you rely on it.
The finance timetable should therefore be built backwards from what the transaction actually needs: business credit, property valuation where there is a freehold, any landlord consent where there is a lease, and the seller's evidence. Your broker can tell you what the finance process needs; your solicitor decides how that is protected in the contract.
Does formal approval mean the money is ready for settlement?
No. Credit approval and settlement readiness are different milestones. A lender can approve the transaction in principle or formally and still be waiting for outstanding conditions, security documents, executed loan documents, insurance, final settlement figures or another item that has to clear before funds can be released. The labels vary between lenders, so the safest question is: what is still outstanding before this facility can actually draw?
- Indicative or pre-approval: the lender has not necessarily approved the actual business, property, valuation or final structure.
- Credit or formal approval: the credit decision has advanced, but approval can still carry conditions that must be satisfied before documents or drawdown.
- Conditions satisfied: the lender has received and accepted the items it required, but documents and settlement mechanics may still remain.
- Documents executed: signing the loan and security documents is necessary, but it is not the same as the lender confirming that all settlement requirements are cleared.
- Ready to draw or settle: the remaining lender, legal and settlement requirements have been cleared so the facility can fund the transaction on the nominated settlement date.
These are practical stage descriptions, not universal lender terminology. Ask your broker or lender for the outstanding-condition list on each facility rather than relying on the word “approved”.
What has to be ready for the morning after settlement?
Settlement pays the seller and transfers the agreed assets; it does not by itself make the business operational. Before completion, build a handover list for banking and payment access, payroll and super, supplier and customer accounts, insurance, licences, stock, systems and passwords, utilities and the seller's transition obligations.
- If the freehold is included: have the property-side handover ready as well, including keys and security access, building insurance, utilities, ownership outgoings and responsibility for maintenance from settlement.
- If you are taking an assigned lease: confirm the assignment or replacement lease is effective, any bond or bank guarantee requirements are dealt with, the rent and outgoings position is clear, and any landlord conditions have actually been satisfied.
- Either way: leave enough working capital for the first operating cash cycle. The purchase being fully funded does not mean payroll, suppliers, stock and tax are funded after control changes.
Source: Business Queensland, Completing the purchase of a business, read live 26 August 2026. Its handover guidance includes transition arrangements, keys and security devices, software access, utilities, banking and insurance notifications. For the broader post-settlement funding and working-capital mechanics, see the parent guide to funding a business purchase.
What does a lender secure when there is no property in the deal?
With no property in the transaction, a lender secures the loan against the buying entity, its assets and the people standing behind it, and it does that with three specific instruments rather than one. Naming them matters, because each one has a different consequence if the business does not perform.
The three instruments, and what each one actually does
- A general security agreement over the buying entity. This is a registered security interest across the company's present and future assets: plant, stock, debtors, the fitout it owns, and the business itself as a going enterprise. It is the instrument that makes a secured business loan secured when there is no land involved.
- Director guarantees. The directors of the buying entity personally guarantee the facility. This is close to universal on an acquisition and it is not a formality; it is the reason a business-only purchase reaches past the company balance sheet.
- Outside real property as additional security. Where the business assets alone do not carry the exposure, a lender will look for real property you already own to be offered as further security. Whether that property is residential or commercial changes the assessment materially, and that is worked through in residential or commercial security on a business purchase.
The order matters as much as the list. A lender does not start with your home; it starts with what the business can carry and moves outward only when that is not enough. Across the purchases we fund, the buyers who are surprised at the end are almost always the ones who never asked what the fallback security position was at the beginning.
What this does to the loan itself
Security that sits in a trading entity rather than in land behaves differently over time. Land does not walk out the door; debtors, stock and goodwill can. That is why a business-only facility is generally written over a shorter horizon than a property facility, and why the length of that horizon is not really a lending question at all. It is a lease question, and it is the next section. The broader acquisition-finance picture, including how vendor terms and working capital sit alongside this, is in the parent guide to funding a business purchase.
From our broking, indicative
Across the purchases we fund, the security conversation on a business-only deal is a conversation about instruments, not about a number. What a lender is secured against is a general security agreement over the buying entity, guarantees from its directors, and in many cases real property you already own added as further security. None of that is unusual and none of it is negotiable in the way buyers expect it to be.
What does move is whether the deal gets funded at all. Ranked by how often they are the reason a business-only purchase stops, these are the five that come up:
- Not enough secure years left on the lease to cover the loan term the buyer wanted
- No landlord consent to the assignment, or consent that arrives with conditions nobody priced
- Trading figures that do not reconcile to the business activity statements and lodged returns
- A price carrying goodwill the vendor cannot evidence with anything other than an asking price
- No working capital allowance for the first cash cycle after settlement
Indicative only, based on deals we have placed, as at August 2026. This is a description of what we see, not a quote, not an offer and not a prediction about your transaction. Actual terms depend on lender policy and your circumstances at the time of application. General information only and not financial advice.
How long can your loan run on a lease you inherit?
The secure occupation left in the lease often sets a practical limit on how long the business funding can run, especially where the business depends heavily on that location. A lender does not want the facility to outlive the buyer's reliable right to occupy the premises, although the final term can also be affected by other security and lender policy.
That produces a specific problem. The seller has usually been in the premises for years and has been living off the back end of a lease that once looked long. What the buyer inherits is the tail. If the tail is short, the loan term compresses to match it, repayments rise for the same borrowed amount, and a deal that worked on the buyer's spreadsheet stops working on the lender's. Nothing about the business has changed; only the horizon has.
What actually helps, and what only looks like it helps
Options to extend help, but an option is worth exactly what its exercise conditions allow. An option that can be defeated by a rent review with no cap, or one that requires the landlord to be satisfied of something undefined, is weaker than its years suggest. A negotiated extension agreed with the landlord before settlement is stronger than an option, because it is certainty rather than a right to ask. Across the purchases we fund, the single most useful thing a buyer can do early is get the landlord conversation started before the finance conversation is finished, not after.
What the lease you take over gives you, and for how long, is therefore a finance document as much as a legal one. If you are weighing occupancy more generally rather than in the middle of a purchase, the operating version of that question is a different page: buying against leasing business premises.
Who should actually own the property?
There is no single best entity to own the premises. The common choices are the trading company, a separate company or trust, the individuals personally, or an SMSF, and the decision changes the legal separation between the property and the trading business, who the lender assesses, how rent or occupancy is documented and what can be done with the asset later.
A short vocabulary note, because these terms carry weight in this section. An owner occupier structure is one where the same interests own the premises and run the business from them, whether or not the two sit in the same legal entity. A bare trust is a holding arrangement in which a trustee holds legal title to the property while the beneficial ownership sits elsewhere, and it is the structure used to hold property inside a borrowing arrangement in superannuation. Neither term describes a tax outcome on its own.
| Structure | Separation from the trading entity | Who the lender looks to | What to watch |
|---|---|---|---|
| The trading company | None. The property and the operating business sit in the same legal entity | One entity, with the property and the business on the same balance sheet | Simple to set up and hard to unwind later without a dutiable transfer |
| A separate holding company or trust leasing back | Separate legal ownership from the trading entity, although guarantees, mortgages and other security can still connect the positions | Both entities, and usually guarantees across them | Needs a real lease on real terms, a second set of accounts, and consistency between the two |
| The individuals personally | The property is outside the trading company, but it sits in the individuals' own legal and financial position | The individuals, with the business as the tenant and the income source | Personal ownership of a commercial asset has consequences for tax, estate planning and future borrowing |
| A self-managed super fund | The fund is a separate regulated ownership structure; whether it is appropriate depends on superannuation, tax, borrowing and related-party rules | The fund, the holding arrangement and the members behind it | Only available where the property meets the business real property test, and the borrowing rules changed in August 2026 |
This table is qualitative on purpose. The tax consequences of each structure depend on facts this page cannot see and belong with your accountant and lawyer before contracts are exchanged.
Two adjacent transactions get confused with this one and should not be. Selling premises you already own and staying on as the tenant is an exit from ownership, not an entry into it, and it is covered in sale and leaseback. Buying the premises you already occupy from your existing landlord is a different negotiation with a different counterparty, and it is covered in buying your premises from your landlord. This page is about the premises arriving with the business.
Can your SMSF own the premises after 10 August 2026?
Yes, a self-managed super fund can still hold the premises you buy with a business, but from 10 August 2026 the borrowing rules narrowed to exactly that case and nothing wider. The Australian Taxation Office states that under the new rules a limited recourse borrowing arrangement can only be used to acquire real property if the property is business real property.
Three things are grandfathered, and the third is the one buyers miss: existing arrangements entered into before 10 August 2026, refinancing of those existing arrangements, and binding contracts to acquire real property exchanged before 10 August 2026 even where the contract settles or the borrowing arrangement is entered into after that date. If your contract was exchanged before the cut-off, the date on the loan does not undo that.
Source: Australian Taxation Office, Changes to LRBAs for property from 10 August, page updated 29 July 2026, read 26 August 2026. Whether a particular fund and a particular property qualify depends on the facts. Get advice before acting.
What business real property actually means
Business real property is property used wholly and exclusively in one or more businesses. The Tax Office puts it as land and buildings used wholly and exclusively in a business, and points to its ruling SMSFR 2009/1 for how the test is applied. The test looks at the actual use of the property, not its zoning and not what the sign on the front says, which is why an owner-occupied workshop or consulting suite usually satisfies it and a property with a substantial unrelated use does not.
Source: Australian Taxation Office guidance on business real property for self-managed super funds, page updated 16 September 2025, read 26 August 2026, and the Superannuation Industry (Supervision) Act 1993 on legislation.gov.au, compilation current at 10 August 2026. The test is applied to the actual use of the property, not its zoning. Not tax advice.
This page covers only what is specific to acquiring the premises together with the business. Whether a fund should hold commercial property at all, how those facilities are structured and what a lender needs from the fund are general questions with a general answer in how commercial property loans work. The residential side of the August change is out of scope here; what matters for this decision is that the business real property carve-out survived it.
How does the contract split the price across land, plant, stock and goodwill?
The contract usually allocates the purchase price across land, plant and equipment, stock and goodwill, and that apportionment feeds into the valuation, duty, GST and tax analysis. It does not decide those outcomes by itself, but an allocation that does not match what was actually bought can create problems for both sides.
The reason is structural. Duty falls on some categories and not others, GST treats some supplies differently from others, and depreciation runs on the tangible items rather than the intangible ones. An apportionment that reflects what was actually bought will survive scrutiny. One written to produce a convenient answer will not, and the party who benefits from it is not always the party who has to defend it.
Goodwill is the line most often argued about, because it is the part of the price with no physical existence and the part a lender will not treat as security. How goodwill is funded when it makes up a large share of the price is worked through in funding goodwill on a business purchase. The other line that gets mishandled is the fitout: leasehold improvements installed by a previous occupier may not be the seller's to sell at all, and on a leased site the question of who owns them at the end of the term is a lease question, not a contract question.
| The line in the contract | Apportionment that holds up | Apportionment that creates problems |
|---|---|---|
| How the split was arrived at | Each category valued on its own basis | A round-number split with no working behind it, or categories backed out of the total |
| Plant and equipment | An itemised list with condition and age, matching what is on the floor | A schedule that does not match the equipment actually there |
| Stock | Counted at settlement | Estimated at exchange and never revisited |
| Land | Supported by a valuation the lender has also seen | Value shifted in or out of the land line to suit one side's tax position |
| Fitout and leasehold improvements | Ownership established before exchange, including who owns it at the end of the lease term | Fitout sold that the seller does not own |
| Fixtures versus loose plant | Each item classified deliberately, because a fixture forms part of the land and loose plant does not, and the two are searched on different registers and can be treated differently for duty | Everything lumped into one plant figure, leaving the boundary between what is attached to the building and what is not for someone else to argue later |
| Goodwill | Treated as the residual it actually is, with trading history to explain it | Evidenced only by what the seller is asking |
| What both parties lodge | The same allocation, used consistently by buyer and seller | Buyer and seller lodging on different allocations |
Are you buying the assets, or the company that owns them?
Everything above assumes an asset sale: you buy the business and, where the freehold is included, the land, and each category is identified in the contract and transferred to you. The alternative is a share sale, where you buy the shares in the company that already owns all of it. If that is the deal on the table, the apportionment question does not arise in the same form, because nothing is being transferred; you are acquiring the entity with whatever it already holds, including liabilities you may not have found.
The two are taxed differently, they attract duty differently, and the diligence you have to do is different in kind rather than in degree. Which structure the contract uses is one of the first things to establish, and it is a question for your solicitor and accountant before you price the deal, not after. This guide does not attempt the comparison, because the answer turns on the entity, the assets it holds and your own position.
Get the apportionment drafted with your accountant and lawyer before exchange. It is far cheaper to argue about it while the contract is still a draft than to explain it to a revenue office afterwards.
Is the sale GST-free as a going concern, or not?
A sale is GST-free as the supply of a going concern only when five conditions are all met: the sale includes everything necessary for the continued operation of the business, the seller carries the business on until the day of sale, the sale is for payment, the buyer is registered or required to be registered for GST, and both parties have agreed in writing that the sale is of a going concern. Missing one is enough to take the sale outside the treatment. The Australian Taxation Office sets those conditions out, and every one of them has to hold.
- The sale includes everything that is necessary for the continued operation of the business
- The business is carried on by the seller until the day of sale
- The sale is for payment
- The purchaser is registered, or required to be registered, for GST
- The purchaser and seller have agreed in writing that the sale is of a going concern
Source: Australian Taxation Office, GST and commercial property and its guidance on selling a going concern, page last updated 15 December 2022, read live 26 August 2026. The conditions as listed above are the ATO's; the underlying provision is section 38-325 of the GST Act. Whether a particular sale qualifies depends on the contract and the facts. Not tax advice.
| Condition | What it means in the transaction | Who has to do something about it |
|---|---|---|
| Everything necessary for continued operation is included | The buyer receives what the business needs to keep trading, which on a leased site includes the right to occupy the premises | Both, through the contract and the schedules |
| The business is carried on until the day of sale | The seller keeps trading up to settlement rather than winding down before it | The seller |
| The sale is for payment | There is consideration for the supply | Both |
| The buyer is registered, or required to be registered, for GST | Registration has to be in place for the buying entity, not for a related company or for you personally | The buyer, and it is worth confirming which entity is on the contract |
| Both parties have agreed in writing that it is a going concern | The agreement belongs in the contract before exchange, not in correspondence afterwards | Both, and this is the condition most often missed |
The written agreement condition is the one that gets missed, because it is the only one that is purely administrative. It has to be in writing and it has to be agreed, which means it belongs in the contract rather than in an email after settlement. Note also that the phrase carries a second, unrelated meaning in accounting and audit, where it describes whether an entity can continue operating; that is not what is being discussed here. The glossary entry separates the two, and the longer explanation sits in what a going concern actually means.
Where the margin scheme comes in
The margin scheme is a method of working out GST on a property sale by reference to the margin rather than the full price, and where the sale is not GST-free it may be available on the land component. Eligibility is not automatic and is decided largely by how the seller acquired the land in the first place. The Tax Office states you cannot use it where you purchased the property as fully taxable and the margin scheme was not used, including where the property came to you as part of a business sale on that basis, and that generally if the previous owner was not eligible to use the margin scheme, you will not be able to use it either.
Source: Australian Taxation Office, Eligibility to use the margin scheme, page last updated 17 June 2025, read live 26 August 2026. Eligibility depends on how the seller acquired the land. Not tax advice.
How can transfer duty differ when a business sale includes land or a lease?
Transfer duty is state-based, so the treatment of land, lease assignments, fixtures, goods, goodwill and other assets depends on the jurisdiction. Do not apply one state's treatment nationally. This guide gives the two positions verified against primary sources for this build and leaves the other jurisdictions to their own revenue offices rather than filling a national table with unsourced assumptions.
In New South Wales, Revenue NSW lists land, interests in land including the assignment of an existing commercial or retail lease, and fixtures as dutiable property in a business sale. It lists goodwill, intellectual property and statutory licences as not dutiable, while goods can become dutiable where they are transferred under an agreement that also includes other dutiable property such as land.
Source: Revenue NSW, Transfer duty on business purchases, page updated 27 May 2026, read live 26 August 2026. New South Wales only. Not tax advice.
Victoria is in transition under the Commercial and Industrial Property Tax Reform Act 2024. The Department of Treasury and Finance says commercial and industrial property is moving away from stamp duty and into the Commercial and Industrial Property Tax system, with eligible purchasers able to access a government transition loan for the final stamp duty payment. The live State Revenue Office material should be checked for the transaction-specific commencement and transition position.
Source: Department of Treasury and Finance Victoria, Commercial and industrial property tax reform, page updated 10 December 2024, read live 26 August 2026. Read the State Revenue Office Victoria for current transaction-specific detail. Victoria only. Not tax advice.
| Jurisdiction | Land and interests in land | Business assets | What a buyer should do |
|---|---|---|---|
| New South Wales | Land, lease assignments and fixtures are within the dutiable categories Revenue NSW identifies for a business sale | Goodwill, intellectual property and statutory licences are listed as not dutiable; goods have a conditional treatment where other dutiable property is in the agreement | Have the contract allocation checked against the Revenue NSW categories before exchange |
| Victoria | Commercial and industrial property is moving through the 2024 reform from stamp duty into the Commercial and Industrial Property Tax system | This guide does not assert a general Victorian business-asset or lease-assignment rule without the live SRO source | Check the current SRO transition position for the property and the transaction rather than applying the NSW treatment |
This is deliberately not an eight-jurisdiction table. Only NSW and the Victorian reform position were verified against primary sources for this build. Queensland, Western Australia, South Australia, Tasmania, the ACT and the Northern Territory should be checked against their current revenue-office guidance for the actual transaction.
And then there is land tax
Land tax is a state or territory holding-cost issue rather than a transaction-cost issue. Taking the freehold can expose you to land tax depending on the jurisdiction, the ownership structure, land values, thresholds and exemptions, so it should be modelled with the actual buyer entity and the owner's other holdings rather than assumed from the purchase price alone. This guide deliberately asserts no rate or threshold for any jurisdiction.
Two adjacent situations are worth a look if they describe you. Buying business premises together with agricultural land brings its own duty, GST and structuring questions and they are set out in buying a farm. If the property leg is an industrial unit, what has to be ready in cash at settlement is covered in cash at settlement on a warehouse or industrial unit.
Which employee entitlements do you take on?
You inherit people, not just assets, and the Fair Work Act rather than your contract decides which of their service you have to recognise. You are not obliged to offer employment to everyone, but where employees do move across with the business, a defined set of entitlements moves with them whatever the sale contract says.
A transfer of business is the statutory concept doing the work here: broadly, where employment with the old employer ends, the person becomes employed by the new employer within a defined period, the work is substantially the same, and there is a connection between the two employers. Where that applies, the Fair Work Ombudsman sets out that the new employer has to recognise an employee's service with the old employer for sick and carer's leave, requests for flexible working arrangements, and parental leave.
Where the new employer is not an associated entity, it may choose not to recognise service for redundancy pay, annual leave, long service leave in defined circumstances, and the minimum employment period for unfair dismissal, provided the employee is told in writing before the new employment starts where that is required. Notice of termination remains an obligation of the old employer where employment with it ends.
Source: Fair Work Ombudsman, Employee entitlements on a transfer of business, read live 26 August 2026; no page date is displayed. See also business.gov.au on managing employees when you sell or close a business. Applies to a transfer of business as defined in the Act. What is negotiated in the sale contract does not change the statutory position.
| Entitlement | Does prior service have to be recognised? | What a buyer should do about it |
|---|---|---|
| Sick and carer's leave | Yes, service with the old employer must be recognised | Get the accrued balances in writing before you price the deal |
| Requests for flexible working arrangements | Yes, service must be recognised | Ask whether any arrangements are already in place |
| Parental leave | Yes, service must be recognised | Ask whether any leave is booked or in progress |
| Redundancy pay | May be declined where the new employer is not an associated entity | Decide before exchange, and give the written notice where it is required before the new employment starts |
| Annual leave | May be declined where the new employer is not an associated entity | Agree whether the seller pays it out at settlement or the balance transfers with a price adjustment |
| Long service leave | May be declined in defined circumstances where the new employer is not an associated entity | Check the state or territory position as well, since long service leave also sits in state law |
| Minimum employment period for unfair dismissal | May be declined where the new employer is not an associated entity | Give the written notice where required, before the new employment starts |
| Notice of termination | Remains an obligation of the old employer where employment with it ends | Confirm the seller has dealt with it rather than assuming it passes to you |
This table restates the Fair Work Ombudsman position sourced above and applies only where the transaction is a transfer of business as defined in the Act. What is negotiated in the sale contract does not change the statutory position. Not employment law advice.
The practical consequence for a buyer is that accrued entitlements are a number in the deal, not a footnote to it. Whether the seller pays leave out at settlement or the buyer takes the liability across with an adjustment to the price is a negotiation, and it should happen with the actual figures rather than an assumption. The same mechanics on a practice purchase, where staff and goodwill are unusually entangled, are worked through in a practice acquisition with property and goodwill.
Can a landlord refuse to transfer the lease when you buy a business?
Yes, a landlord can sometimes prevent a business-only purchase from completing in its current form if the lease cannot be validly assigned, but the permitted grounds and process depend on the lease, the state and whether retail-leasing legislation applies. A lease assignment transfers the existing lease from the outgoing tenant to you; landlord consent is the permission required where the lease or law makes it a condition of that transfer.
Timing rules differ by state and by whether the lease is retail. In Victoria, the Victorian Small Business Commission states that the landlord is considered to have agreed to the transfer where the landlord has not given the tenant written notice that it has consented or withheld consent within 28 days of the tenant's request. Consent may be withheld only on specified grounds, which include the proposed tenant intending a use not permitted under the lease, the landlord considering that the proposed tenant does not have sufficient financial resources or business experience to meet the obligations under the lease, the tenant not having complied with the reasonable assignment provisions of the lease, and, on the sale of an ongoing business, the tenant not having provided business records for the past three years.
The release limb matters just as much and it runs the other way. The outgoing tenant and any guarantors are released from obligations under the lease where the tenant has given the landlord and the proposed tenant a new disclosure statement and that statement does not contain information that is false, misleading or materially incomplete. Read from the buyer's side, the seller has a strong incentive to get the disclosure right, and you have a strong incentive to read it.
Source: Victorian Small Business Commission, Transfer of a retail lease premises, page modified 10 August 2023, read live 26 August 2026. Victorian retail leases only. Other states and non-retail leases differ; check the lease and your state. Not legal advice.
What hidden lease terms can change the deal after you agree to buy?
The assignment itself is only one lease risk. A buyer can inherit a lease with an acceptable headline rent but a short option horizon, an upcoming market review, heavy outgoings, a large bank guarantee, personal guarantees, restrictive permitted use, fitout obligations or an expensive make-good. Those terms affect the cash you need, the loan term the lender can support and what the business is worth to you after settlement.
| Lease item | Why it matters to the buyer | What to confirm before you rely on the lease |
|---|---|---|
| Remaining term and options | The secure occupation period can affect acquisition-loan term, repayments and resale | Expiry date, option dates, exercise conditions and whether an extension is being negotiated before settlement |
| Rent reviews and outgoings | The occupancy cost after settlement may be materially different from the rent number used in the sale memorandum | Review method and timing, current outgoings, arrears or reconciliations, and what costs the tenant is required to pay |
| Permitted use and exclusivity | The lease can constrain what the buyer may do at the site even when the business itself has been sold | That the intended business use is permitted and whether any exclusivity or centre rules matter to the operation |
| Bank guarantee, bond and personal guarantees | Landlord security can tie up cash or collateral and create personal exposure outside the purchase loan | Amount, form, who provides it, when it can be called or released, and whether the landlord is increasing the requirement for the incoming tenant |
| Fitout, repairs and make-good | A buyer can inherit maintenance or reinstatement costs that were not obvious in the business price | Who owns the fitout, current condition, repair responsibilities and what has to be removed or restored at the end of the lease |
| Incentives, breaches and assignment conditions | An incentive may not transfer, an existing breach can delay consent, and the landlord can impose process or document requirements on the assignment | What survives the transfer, what must be remedied, who pays assignment costs and whether the outgoing tenant or guarantor is actually released |
Sources: NSW Small Business Commissioner, Retail Tenancy Guide, which highlights rent reviews, outgoings, option deadlines, security, maintenance and make-good; NSW Small Business Commissioner, Transferring your lease; and the Victorian Small Business Commission source above, read live 26 August 2026. Retail-leasing rules differ by state and the lease itself still controls many commercial terms. Not legal advice.
| The question | The Victorian retail lease position | What it means for a buyer |
|---|---|---|
| What happens if the landlord does not respond | The landlord is considered to have agreed where it has not given the tenant written notice of consent or refusal within 28 days of the tenant's request | Silence is not a refusal, but the clock only starts when the request is properly made, so get it made early |
| Use not permitted under the lease | A ground on which consent may be withheld | If you intend to change what the premises are used for, raise it before exchange, not after |
| Financial resources or business experience | Consent may be withheld where the landlord considers the proposed tenant does not have sufficient financial resources or business experience to meet the obligations under the lease | You will be assessed by the landlord as well as by the lender, on overlapping but not identical evidence |
| The tenant has not followed the lease's own process | Consent may be withheld where the tenant has not complied with the reasonable assignment provisions of the lease | The seller's process failure becomes your delay, so ask to see the request that was actually sent |
| Business records on the sale of an ongoing business | Consent may be withheld where the tenant has not provided business records for the past three years | The same records the lender wants are also the records the landlord can require |
| Is the outgoing tenant released | The tenant and any guarantors are released where the tenant has given the landlord and the proposed tenant a new disclosure statement that is not false, misleading or materially incomplete | The seller has a strong incentive to get the disclosure right, which is exactly why you should read it |
Victorian retail leases only, restating the Victorian Small Business Commission source cited above. Other states, territories and non-retail leases run on different rules and different timeframes. Check the lease itself and your own jurisdiction. Not legal advice.
Start the consent process early, because it sits on the critical path and nothing else moves until it clears. A listing described with the shorthand buyers see everywhere is not telling you what the lease says, and the glossary entry on that shorthand is worth two minutes before you rely on it. If the landlord conversation ends up somewhere unexpected and the premises come onto the table, that is a different transaction again: buying commercial premises you occupy.
Which licences, permits and financed equipment transfer with the business?
Everything the business trades under has to be transferred, re-applied for or searched, and the list is longer than most contracts acknowledge. Work through it item by item before settlement rather than discovering it after.
- The business name and any registered trade marks. Registration is a transfer, not an assumption, and it does not happen because the contract says it does.
- Every licence and permit the business trades under. Establish for each one whether it transfers with the business, transfers with the operator, or has to be applied for fresh in your name before you can trade.
- Planning and occupancy permissions. These attach to the use of the premises rather than to whoever is running it, so they survive the sale and so do any conditions or breaches attached to them.
- A PPSR search against the seller and against serial-numbered plant. Personal property under the Personal Property Securities Act means property other than land, and the Act's definition of land includes all estates and interests in land but does not include fixtures. That is precisely why plant, equipment and unattached fitout are searched on the register and the land is searched on title.
- The title search. A separate search on a separate register, covering encumbrances, easements and anything else registered against the land itself.
- Equipment that is not the seller's to sell. Financed, leased or subject to a retention of title arrangement. The item on the floor is not evidence of ownership, and this is a common late surprise.
- Fitout, and who owns it at the end of the term. On leased premises this is a lease question, and the answer can be that you are obliged to remove it at your cost.
Source: Personal Property Securities Act 2009 (Cth) section 10, on legislation.gov.au, compilation date 14 October 2024, read live 26 August 2026. Quoted for the definitions of personal property and land only. Not legal advice.
Where the business is a professional practice, the licensing and registration layer is heavier again and the plant is frequently financed, which is set out in the practice acquisition entry. Whatever the sector, the searches are cheap and the surprises are not.
What does each shape cost to hold, and what happens when you sell?
Owning the premises leaves you holding two assets that can be sold separately, together, or at different times. Buying on an assigned lease leaves you holding one asset whose sale depends on a landlord agreeing to the next assignment. The day you sell is when that difference finally shows up, and it is decided years earlier by the shape of the purchase.
Holding cost
Taking the freehold converts rent into a mortgage plus the costs of ownership: rates, insurance, land tax, structural maintenance and whatever the building needs that a landlord would otherwise have handled. Some of those are predictable and some are not. Buying business only keeps the outgoing simpler and puts it in someone else's control, subject to the review mechanism in the lease. Neither position is cheaper in the abstract, and anyone who tells you otherwise has not seen your building or your lease. This guide quotes no figure for either, because there is no honest general one.
Exit
Owning the premises can widen the buyer pool for the business, because a purchaser can be offered the business alone on a fresh lease from you, or the business with the freehold. It also gives you the option of selling the business and keeping the building as an income-producing asset. That flexibility is the strongest argument for taking the freehold and it is the one that shows up last.
Selling on an assigned lease can narrow the field to buyers the landlord will accept, and it re-runs the consent process at the worst possible moment. It also caps how the business can be valued, because a short remaining term is as much of a constraint on your buyer's finance as it was on yours. The capitalisation rate that a valuer applies, the rate used to convert an income stream into a capital value, is not something you control, but the security of the income stream underneath it is.
Valuation mechanics are their own subject and this guide does not attempt them. What the valuer actually tests on the property leg is in what a commercial valuation actually tests, and how a trading business is valued is in how a going concern is valued. If the exit involves the seller carrying part of the price, the terms and the risks of that sit in vendor finance, and the wider property side of the decision runs through the property lending hub.
What to do when you can only fund one of them now
Wanting the freehold and being able to fund it on the same day are different questions, and a buyer who cannot do both at once has three usual ways through rather than a straight no. Which one is available depends on the seller, the building and the numbers, so treat these as the conversations to have rather than as options you can assume.
- Buy the business now and negotiate a position on the freehold for later. An option, a right of first refusal, or simply a longer lease with an agreed mechanism. The value of this is that it stops the building being sold out from under the business you just bought, and it is a drafting question for your lawyer before exchange rather than a finance question.
- Take the freehold and release the capital tied up in it. Where the property is bought and the cash is needed back in the business afterwards, sale and leaseback is the structure that does it, and it turns you back into a tenant, with everything on this page about lease terms applying again.
- Ask the seller to carry part of the price. Where the gap is on the business leg rather than the property leg, vendor finance is how sellers bridge it, and it comes with its own terms, security and risks that need to be understood before it looks like free money.
None of these is a default and none is a product recommendation. They are the three shapes this conversation usually takes, and which one fits is decided by the contract, the building and the lender's read of both.
If you own both, there is no lease between them
One consequence of owning the business and the building in the same hands catches sellers years later: there may be no arm's length lease in place at all, because the business has simply been occupying premises its owner also owns. That is unremarkable while you hold both. It matters on the way out, because a buyer who wants only the business needs a lease granted to them, on terms that will have to satisfy their lender, and the terms you grant at that point will set what their finance can do. If the plan is ever to sell the business and keep the building, that lease is worth drafting deliberately rather than at the last minute, and it is a conversation for your lawyer and accountant well before the business is on the market.
Buying a business with the property and buying it on an assigned lease are not two prices for the same transaction. Taking the freehold turns one purchase into two facilities with two credit assessments, hands you a loan term set by the asset instead of by a lease, puts land and interests in land into the dutiable half of the contract, and leaves you holding something you can sell separately later. Buying the business alone keeps the entry smaller and hands the term, the consent and the exit to a landlord you did not choose. Everything else on this page follows from that one decision, which is why it is worth making it deliberately and with your accountant, your lawyer and your broker in the room at the same time. If you are already under contract, the item most likely to move your settlement date is not the finance at all: it is landlord consent on a business-only deal, or a valuation on a deal with the freehold in it.
Key takeaway: decide the shape of the purchase before you negotiate the price, because the shape sets what you can borrow, what you will be taxed on, and what you will be holding on the day you sell.Frequently Asked Questions
Neither is better in the abstract. Taking the freehold gives you control of the premises and a second asset, but it also adds property due diligence, a separate property credit assessment and more capital tied up at settlement. Buying the business on a lease keeps the property out of the purchase but makes the remaining lease term, landlord consent and assignment process part of the risk. The better shape is the one that fits the business, the property, your available capital and your exit plan.
There is no single deposit figure because the property and business credit legs are assessed differently. The property side turns on security type, valuation and lender policy; the business side turns on maintainable earnings, goodwill, tangible assets, buyer contribution and the wider security package. The real cash requirement also includes transaction costs and working capital, so a percentage quoted before the contract split and valuation are known is incomplete.
Often the freehold and trading business are assessed as separate credit legs, but that does not mean every acquisition has exactly two loan accounts. A deal can also use asset finance or working-capital facilities. The important point is that the lender assesses the property and the trading business on different evidence and they can fail or clear at different times even though they have one settlement date.
A lower lender valuation can reduce the amount the lender is prepared to advance against the property, which can increase the cash, equity or other support required at settlement. It does not automatically decide the separate business credit leg, but because both parts have to settle together a property shortfall can still delay or stop the whole purchase. Get the valuation moving while the finance condition is still alive. Read what a commercial valuation actually tests.
Yes. Business due diligence and property due diligence answer different questions. The business review covers financials, contracts, employees, licences, stock, equipment and liabilities. The property side adds title and property searches, zoning and permitted use, planning and building approvals, physical condition, insurance and ownership costs, plus the lender's valuation. A lender valuation does not replace your own legal or physical property due diligence.
It can. A short secure lease term can force a lender to shorten the business facility, increase the repayments for the same debt, require stronger supporting security or make the deal unattractive on the terms the buyer expected. An option to extend may help, but its value depends on whether the option can actually be exercised and on the rest of the lease. A negotiated extension before settlement gives the lender a clearer occupation period to assess.
There is no default right answer. Holding the premises in the trading company is simple but puts the property and trading business in the same legal entity. A separate company or trust creates separate ownership but usually means a formal lease or occupancy arrangement and a lender that looks across both positions. Personal ownership and SMSF ownership have different tax, superannuation, estate-planning and borrowing consequences. Choose the buyer entity with your accountant and solicitor before the contract is locked in.
An SMSF can hold premises where the property meets the business real property rules and the fund and transaction satisfy the relevant superannuation requirements. From 10 August 2026, the ATO says an LRBA can only be used to acquire real property if it is business real property, with specified grandfathering for existing arrangements, refinances and binding contracts exchanged before that date. Whether a particular fund and property qualify depends on the facts and needs advice before signing.
It depends on the jurisdiction. In New South Wales, Revenue NSW lists goodwill as not dutiable and lists land, interests in land including lease assignments, and fixtures as dutiable categories, with a conditional rule for goods. Other states and territories can differ, and Victoria is moving commercial and industrial property through a separate reform. Do not apply the NSW answer nationally.
If the lease cannot be validly assigned, a business-only purchase may not be able to complete in its current form. The grounds and process depend on the lease, the state and whether retail-leasing legislation applies. In Victoria, the Victorian Small Business Commission sets out specified grounds for refusing a retail-lease transfer and a deemed-consent rule after 28 days in defined circumstances. Other jurisdictions and non-retail leases differ, so the lease and local law have to be checked.
Yes, if the seller and funding allow it. Common conversations include buying the business now under a longer lease and negotiating an option or right of first refusal over the property, acquiring the property later once the business has trading history under your ownership, or using vendor finance or another negotiated funding structure where the gap is on one leg. None of those rights exists automatically; they have to be agreed and documented before you rely on them.
Do not assume the clause automatically lets you walk away. What happens depends on the wording, the contract and the jurisdiction, including the deadline, notice and evidence requirements. Ask your solicitor what has to be done before the date expires and whether an extension should be requested. On a business-only deal, landlord consent can run on a separate clock from finance. If you cannot rely on the clause, the deposit and default consequences are questions for your solicitor under the actual contract.
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