Private ruling: CGT - extension of time
Date of advice: 15 July 2022
Published: November 2022
Ruling period: Year ending 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Will the Commissioner exercise the discretion under subsection 152 - 125(4) of the Income Tax Assessment Act 1997 (ITAA 1997) to allow an extension of time to XX December 20XX? | A1: Yes, having considered the relevant facts, including the delay in receiving the funds from the sale, the Commissioner will apply subsection 152-125(4) of the ITAA 1997 and allow an extension of time to make the payment of the exempt amount under subparagraph 152-125(1)(b) of the ITAA 1997.

Relevant facts and circumstances: You commenced carrying on a small business. In the 20XX-XX financial year you sold your small business (consisting of assets, management of employees and clients) to another entity (Company A). Company A has not secured the required finances to fulfil the contract of sale and therefore settlement has not occurred. Company A intended to fulfil the contract of sale by XX July 20XX but this did not occur. You have determined that under subdivision 152-B of the ITAA 1997, you satisfy and intend to apply the 15-year exemption. Company A have still not been able to fulfil the contract of sale, explaining that they are relying on funds from their associates for the payment of the purchase price. If the matter cannot be settled within the next XX months, you will end the contract.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 152-125(4)