ATO ID 2003/166: CGT small business concessions: maximum net asset value test - Australian currency
Date of decision: 13 February 2003
Year of income: Year ending 30 June 2003
Business line: Public Groups and International

Issue
Is Australian currency, that is, notes and coins, a CGT asset for the purposes of determining the 'net value of the CGT assets' of certain entities under paragraph 152-15(a) of the Income Tax Assessment Act 1997 (ITAA 1997)?

Decision
Yes. Australian currency is a CGT asset for the purposes of determining the 'net value of the CGT assets' of certain entities under paragraph 152-15(a) of the ITAA 1997.

Facts
The taxpayer carries on business and at any point in time has Australian currency on hand (that is, notes and coins).

Reasons for decision
Summary: A basic condition for small business relief in Division 152 of the ITAA 1997 is the maximum net asset value test in section 152-15 of the ITAA 1997. Under this test the net value of the CGT assets of the taxpayer and certain related entities must not exceed $5 million (or $6 million for the 2007-08 and later income years). In this context, Australian currency, being Australian notes issued by the Reserve Bank of Australia or Australian coins issued on the authority of the Federal Treasurer, is a CGT asset, and is therefore included in the calculation of the 'net value of the CGT assets' under section 152-15 of the ITAA 1997. Note: Australian currency is not a CGT asset under section 108-5 of the ITAA 1997 when it is used as legal tender (Taxation Determination TD 2002/25).

Legislative references: Income Tax Assessment Act 1997 section 108-5 section 152-15 paragraph 152-15(a)
Related public rulings and determinations: Taxation Determination TD 2002/25
Subject references: Keywords Capital gains tax CGT assets Active asset test CGT small business relief Basic conditions for relief Maximum net asset value test