Private ruling: Extension of time replacement asset
Date of advice: 7 April 2020
Published: May 2020
Ruling period: Year ending 30 June 2020 | Year ending 30 June 2021 | Year ending 30 June 2022
Date scheme commenced: 1 July 2019

Ruling: Q1: Will the Commissioner extend the replacement asset period? | A1: Yes. Having considered your circumstances and the relevant factors the Commissioner considers it appropriate to grant an extension of the replacement asset period. Further information on the factors can be found by searching 'QC 18383' on ato.gov.au

Relevant facts and circumstances: In 20XX you and your spouse signed a contract for the sale of your jointly owned property. The property was used in the primary production business conducted by a related company. You and your spouse made a capital gain on the sale of your ownership interests in the property and you applied the small business rollover to defer the capital gain you made on the sale of the property. You and your spouse have been actively seeking to purchase a replacement property within the two year period, but you have been unsuccessful in acquiring a property. Due to drought conditions over the past three years the number of properties on the market has been limited or those on the market are not suitable, for example poor steep or heavily forested and eroded land that is not profitable and banks will not finance in an agricultural loan. You are seeking properties in the region near your main farming business. You have engaged the services of property agents to assist you with locating a replacement farming property suitable for your farming business and within your price range. Properties coming on to the market have improved as the region recently received some rain. Two suitable properties were marketed recently, but you were unsuccessful in acquiring either property.

Relevant legislative provisions: Income Tax Assessment Act 1997 Section 104-185(1) | Income Tax Assessment Act 1997 Section 104-190(2) | Income Tax Assessment Act 1997 Subdivision 152-E