A Practical Guide to Selling a Business When You Retire

In Spain, more than 540,000 business owners (16% of the total) will reach retirement age by 2030, according to the Asociación de Trabajadores Autónomos (ATA), Spain's association of self-employed workers. Many of them will have operating businesses without a successor, despite having created jobs, wealth, and a solid track record.

For those without a successor, the remaining option is to start a sale process for the business, and they may have many questions: What documentation do I need to prepare? What happens to the licenses? What taxes will I pay? What regulations apply? How do I find interested buyers? How much should I sell the business for? We'll answer all of these step by step in this practical guide to selling a business when you retire.

What are your options for selling an operating business?

When there's no family succession, there are several ways to carry out a retirement business transfer:

1. Sale to interested employees
2. Sale to other companies in the sector
3. Sale to private investors
4. Sale to funds or business groups

If you don't know how to find business buyers, at Deale we connect business owners with strategic and financial buyers interested in acquiring operating businesses quickly, securely, and effectively.

Why work with an advisor when buying or selling a business?

Selling a business doesn't have to be complicated, especially if you have professional advice. Business sale specialists, or M&A (mergers and acquisitions) advisors, help you:

1. Value your business accurately
2. Identify opportunities for improvement
3. Find interested buyers
4. Support you through negotiation and closing

They also answer questions about taxes, contracts, and the documentation needed for the deal to meet all legal requirements.

Business exit plan: where to start?

If you've already made the decision and want to sell your business when you retire, the first step is to prepare a clear, well-organized business exit plan. It includes the following elements:

‍Licenses and permits‍

You need to gather all documents related to the company's activity, such as operating licenses, authorizations, and registrations. The Ley de Procedimiento Administrativo Común de las Administraciones Públicas (Law 39/2015 on the Common Administrative Procedure of Public Administrations) requires all of this documentation to be in order when selling a business.‍

‍Current contracts and agreements‍

It's essential to review all contractual relationships with suppliers, customers, sales agents, and employees to know the status of each one, so you can notify the buyer and avoid breaching any contract.

The company's financial position‍

The buyer will want to see clear accounts. You must have:

1. An up-to-date balance sheet
2. Income statements
3. Cash flow
4. Status of debts and assets

Employment situation

Detail the staffing structure: number of employees, salaries, labor costs, seniority, and current contracts. The new owner needs to know these terms, since they will have to take them on.

Steps to sell a business when you retire

Here's a step-by-step guide to the key milestones in any retirement business sale:

Step 1: Make the decision and prepare the information

Once the decision is made, you start gathering financial, legal, and operational documentation.

Step 2: Value the business

At this stage, valuing the business is key. You should have done some prior work that takes into account metrics such as EBITDA, liabilities, and assets so you can set an objective price for the company and negotiate with the parties interested in buying it.

You can value your business confidentially, for free, and in just one minute.

Find out what your business is worth now

Step 3: Look for buyers

List your business on specialized platforms like Deale, which bring together investors looking for operating small and medium-sized enterprises.

Step 4: Negotiate and agree on terms

This is where the final price, payment terms, and any clauses on staying on or providing support during the transition are defined.

Step 5: Sign the agreement

Financial advice and legal advice can be key at this point to draft an agreement that meets all the regulatory requirements of Spanish law. This is also where essential details are included, such as the payment method, the former owner's relationship with the business, any specific clauses, and so on.

Step 6: Taxes

Business transfers are exempt from VAT, but not from the transfer tax (Impuesto sobre Transmisiones Patrimoniales) or from the capital gains the seller must report on their personal income tax (IRPF) return. So once the agreement is signed and the sale is completed, what remains is meeting your tax obligations.

Step 7: Changes of ownership

The administrative process ends with transferring ownership of licenses and permits. To do this, you'll need to go to the city council and/or the relevant authorities to make these essential changes.

This process can take anywhere from several weeks to months, depending on how clear things like the company's valuation and potential buyers are. That's why, for a retirement transfer or sale, it's best to start managing it at least one year in advance so the whole process can be properly wrapped up.

How long does it take to sell a business when you retire?

The process can take anywhere from a few months to a year, depending on the prior preparation, the clarity of the information, and how easy it is to find interested parties. That's why it's best to start preparing at least one year in advance.

Want to sell your operating business?

At Deale, we help business owners who want to sell their business successfully. We support you throughout the entire process:

✅ Listing on our platform

✅ Contact with serious investors

✅ Advice on valuation and taxes

✅ Legal support through closing