Private ruling: Income tax: CGT scrip for scrip rollover
Date of advice: 14 December 2017
Published: September 2018
Ruling period: Year ended 30 June 2018
Date scheme commenced: during the year ended 30 June 2018

Ruling: Q1: Will the requirements in section 124-780 be satisfied such that the Taxpayer will jointly be eligible with NewCo to choose capital gains tax roll-over relief under subdivision 124-M to disregard any capital gain arising to the Taxpayer upon the proposed transfer of shares in SubCo to NewCo? | A1: Yes

Relevant facts and circumstances: The Australian head company of an income tax consolidated group (the Taxpayer) is transferring 100% ownership (all the shares) of one of its wholly owned subsidiary member companies (SubCo) to a newly incorporated company (NewCo) in exchange for shares in NewCo. The arrangement results in NewCo becoming the 100% owner of SubCo, and the Taxpayer becoming a part owner of NewCo. The Commissioner issued a private ruling to the Taxpayer confirming the arrangement will qualify the Taxpayer for CGT rollover under subdivision 124-M.

Relevant legislative provisions: Income Tax Assessment Act 1997 subdivision 124-M