Private ruling: Commissioner's discretion - small business concession
Date of advice: 29 July 2024
Published: 9 September 2024
Ruling period: Year ending 30 June 2025
Date scheme commenced: 1 July 2022

Ruling: Q1: Will the Commissioner exercise the discretion in subsection 104-190(2) of the Income Tax Assessment Act 1997 (ITAA 1997) and extend the replacement asset period to 30 June 2025? | A1: Yes. After taking into consideration that the replacement asset has been acquired within the two-year period however the building of such asset has not successfully been completed within this time. The Commissioner will use the available discretion to grant you further time to 30 June 2025.

Relevant facts and circumstances: You are incorporated. You sold an active asset and made a capital gain. You chose to apply the capital gains tax small business roll-over to the capital gain you made on the disposal of the active asset. You moved to a new location. The proposed plans of the placement active asset were drafted. You obtained a quote to build the asset which you plan to use in the business. The director had several medical and surgical procedures which took time to recover. Advice from the Council was obtained regarding the regulations to build. The building permit application was lodged. Building contractor was engaged. Prior to council approval, due to unforeseeable weather conditions site preparation was started and footings for building was completed. Active asset was delivered. The Council issued building notice requiring Regulation XX certificate from an engineer certifying the structural adequacy of the footings. The engineer was engaged to issue the required certificate for the Council. The Council issued the building permit. Construction commenced on the asset.

Relevant legislative provisions: Income Tax Assessment Act 1997 subsection 104-190(1A) | Income Tax Assessment Act 1997 subsection 104-190(2) | Income Tax Assessment Act 1997 section 104-197 | Income Tax Assessment Act 1997 section 104-198 | Income Tax Assessment Act 1997 Subdivision 152-E