Private ruling: Small business replacement asset
Date of advice: 14 December 2020
Published: February 2021
Ruling period: Year ending 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Will the Commissioner exercise his discretion under section 104-190(2) of the Income Tax Assessment Act 1997 to extend the replacement asset period in respect of the small business capital gains tax (CGT) replacement asset roll-over relief? | A1: Yes. Having considered the relevant facts, the Commissioner will apply his discretion under subsection 104-190(2) of the ITAA 1997 and allow an extension of the time to purchase a replacement asset.

Relevant facts and circumstances: You conduct a primary production business. On the XX of XX 20XX you entered into a contract for the sale of farmland. You elected to use the small business CGT rollover concession Over the past X years you have actively engaged in finding replacement assets to use in your business. Two replacement assets didn't not eventuate, and you were affected by the COVID 19 pandemic and due to restrictions impacted your ability to attend meetings and discussions with agents and inspect potential businesses and properties. You have now engaged in the purchase of a new farmland asset. The process has been delayed due to changes in contracts and restrictions imposed in Victoria, with its second lockdown due to COVID. You anticipated that contracts and sale would have been completed by XX 20XX with transfer of titles to occur after this date. You have signed all documentation and paid the funds into trust account however delays are ongoing with due to COVID and this may still take several months to be finalised. Due to these reasons you are seeking and extension of time until XX 20XX.

Relevant legislative provisions: Income Tax Assessment Act 1997 Subdivision 152-E | Income Tax Assessment Act 1997 Section 104-190