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Case study: Recovering a $750,000 CGT bill


Shine has assisted a small business owner who incurred a $750,000 Capital Gains Tax Liability after being given inappropriate advice from an accountant.

In 2005 and nearing retirement age, our client retained the services of an accountant to provide taxation and superannuation advice on the sale of her business.

After consultation with our client, the accountant recommended that she sell her shares in the company rather than disposing of the business. The accountant advised our client that she would be eligible for the Small Business CGT Concession and would pay minimal tax upon the sale of the shares. Our client followed the accountant’s advice and the sale took place.

Despite the advice given by the accountant, this concession was not available to our client. As a result of the inappropriate advice, our client was liable for $750,000 in CGT upon the sale of her shares.

The business owner’s lawyer, concerned about the way the accountant had dealt with the lady’s business affairs, referred the matter to Shine. We began acting for the business owner in 2013 and argued that had the accountant not given the inappropriate advice, our client would not have proceeded with the sale. Furthermore, we alleged that had the accountant advised her to reorganise her affairs, the CGT Liability could have been reduced to little more than $30,000.

We have worked on behalf of our client to secure a settlement that has allowed her to recover her losses and move forward into retirement.

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Written by Shine Lawyers. Last modified: September 26, 2018.

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