What is labelled a free business valuation is rarely a valuation.

What is marketed as a 'free business valuation' in Australia is typically a broker appraisal, a calculator estimate or an accountant's unsigned figure — not a documented, independent valuation, and generally not built to survive ATO review. An affordable defensible alternative is a fixed-scope independent report. Prismi's Essential tier is $1,495 + GST, single methodology, senior-reviewer signed, delivered in 10–14 business days.

The numbers first: free options and what real reports cost

A free business valuation costs nothing up front because it is not a valuation. Fees for the genuine article vary widely by provider, scope and complexity, and firms do not publish a single consistent scale — as a general guide, fixed-scope reports from independent firms tend to start in the low thousands, and full valuation engagements at larger accounting and advisory firms can run well into five figures for complex, contested or multi-entity matters, particularly where court or tribunal-ready evidence is required. Treat any specific figure you see quoted elsewhere as provider-specific and worth confirming directly with that firm, not as a market-wide rate card. Prismi's Essential tier is $1,495 + GST — a single-methodology, senior-reviewer-signed report delivered in 10–14 business days. That is the honest comparison: not free versus $1,495, but $1,495 versus what a free number costs you the day it is tested.

Broker 'free appraisals', decoded

A broker's free appraisal is a marketing document produced to win your sale listing. That is not a criticism of brokers — it is a description of the incentive. The number is shaped by what wins the mandate, not by what the evidence supports, and it typically carries no documented methodology, no evidence file, no independence statement and no signature from anyone accountable for the conclusion. An informal appraisal like this is not built to establish a defensible position for tax purposes — it is scoped for a listing decision, not a market-value opinion. Used to gauge whether a sale is worth exploring, it has some value. Used as the market value for a CGT event or a related-party transfer, it is a liability.

Free online calculators: what they see and what they miss

Free calculators multiply your reported revenue or profit by a generic industry multiple and return a wide range in about two minutes. What they cannot see is what actually moves value: owner-salary add-backs and normalisation adjustments, owner dependency, customer concentration, lease terms and security of tenure, and the difference between a going concern and a walk-in-walk-out sale. Loss-making and asset-heavy businesses often return zero or nonsense. The output is an on-screen range with no stated assumptions, no author and no document — nothing an accountant, a lender or the ATO can even respond to, and several calculators carry their own disclaimers recommending a qualified valuer for anything beyond a rough guide. As a rough-orientation tool for early curiosity, they are genuinely useful. That is the entirety of their legitimate use.

The accountant's back-of-envelope figure

An accountant who knows your file can give you a quick multiple-based estimate, and as context it is often sensible — they understand your add-backs and your structure better than any calculator. But the figure is usually verbal or an unsigned email, produced without a documented methodology, and almost always accompanied by words to the effect of 'not to be relied upon'. Accountants say that deliberately: valuation engagements carry professional standards (APES 225 for members of the accounting bodies) and independence expectations that a favour-figure for an existing client cannot meet. Most accountants refer tax-purpose valuations to an independent specialist for exactly that reason — and it is why the accountant's estimate, however competent, never becomes evidence.

When free is fine — and when it fails

• ·Fine: early curiosity. You want a ballpark before deciding anything. A calculator or a chat with your accountant costs nothing and commits you to nothing.
• ·Fine: internal planning. Rough scenario numbers for your own thinking, where no third party will ever test them.
• ·Fails: CGT events. Market value substitution (s 116-30 ITAA 1997) and the small business CGT concession thresholds (Division 152) are tested against substantiated market value. A free number has no methodology or evidence file to defend at review — the failure mode is an amended assessment, plus paying for a retrospective valuation done properly under time pressure.
• ·Fails: related-party transfers. The parties are not at arm's length, so the ATO looks for independent substantiation. A free figure from anyone with a stake in the outcome invites the inference that the number was chosen to suit the tax result.
• ·Fails: disputes. In a shareholder or partnership dispute, an unsigned estimate carries no weight, and an opposing expert will dismantle it in a paragraph.
• ·Fails: finance. Lenders want a report with stated methodology, evidence and a signature. A calculator screenshot does not get past credit.

The honest trade-off: what the Essential tier does not cover

The Essential tier is deliberately fixed in scope, and you should know what that excludes before you buy. It applies a single methodology — the one the facts best support — rather than cross-checking two or three. It is built for straightforward, single-entity matters where the parties are not in conflict and ATO review risk is routine rather than elevated. It is not suited to contested matters, family law, shareholder disputes or positions the ATO is already questioning — those need the Comprehensive tier (from $3,995 + GST, dual methodology) or the Defensible Valuation File (from $8,995 + GST, triple methodology, built for elevated review risk). Fixed scope is not corner-cutting: every Essential report is evidence-led, independent and senior-reviewer signed, with the working file retained for 10 years and fees fixed at engagement, never contingent on the outcome. But if your matter carries dispute or elevated ATO risk, buying the cheapest tier is the same mistake as using the free number — and we will tell you that before you engage.

The real question is the most affordable defensible option

'Free' is the wrong search once real money or the ATO is involved — the right question is the most affordable option that will actually hold. For a straightforward single-entity matter, a fixed-scope independent report answers it: Prismi's Essential tier is $1,495 + GST, delivered in 10–14 business days, with retrospective dates at +$495 per historical date, additional entities at $750 each and rush turnaround at +30%. If you are weighing the full landscape — calculators, appraisals, desktop reports and full reports, and what each is safe for — our guide at /insights/cheapest-way-to-value-a-business-australia walks through every option with prices, and /services/cheap-business-valuation-australia explains how we keep a genuine valuation at the affordable end without thinning the evidence. And if a free number is truly all your situation needs, we will say so — a five-minute conversation about your purpose costs nothing and tells you which side of the line you are on.