Private ruling: Commissioner's discretion - extension of time to make a choice
Date of advice: 16 December 2025
Published: 9 February 2026
Ruling period: Year ended 30 June 20XX
Date scheme commenced: DD MM 20XX

Ruling: Q1: Will the Commissioner exercise their discretion under paragraph 103-25(1)(b) of the Income Tax Assessment Act 1997 (ITAA 1997) to allow an extension of time to choose to apply any available small business capital gains tax (CGT) concessions to a capital gain that arose in the 20XX income year? | A1: Yes. We do not consider that you have made a choice in relation to the small business CGT concessions in the 20XX income year. The Commissioner will allow an extension of time to make a choice to apply any available CGT small business concessions. The private ruling has been limited to the question requested upon application which is whether the Commissioner will exercise the discretion under paragraph 103-25(1)(b) of the ITAA 1997. The Commissioner has not considered your eligibility for the small business CGT concessions.

Relevant facts and circumstances: You owned property that was used in a business conducted through a partnership. The partnership included yourself, your spouse, and your children. The property was always used for the business by you and your family throughout the period of ownership. You have been planning toward your retirement and handing the farm operation to your children. During the relevant income year, you undertook steps to prepare an off-market contract to transfer ownership of the property to your children. Some titles were pre-CGT assets and were exempt from CGT. Some titles were acquired post-CGT and you intended to use the small business CGT concessions to mitigate the CGT consequences. There were various delays in the finalisation and processing of the transfer paperwork. The settlement agent assisting with the process and liaising with your relevant State's titles office advised you that the transfers had not been affected until the next income year. You relayed this to your tax agent when preparing your relevant income year's tax return, so the issue of accounting for the CGT event and reporting the property transfers was deferred to the next income year. When your tax agent obtained the paperwork to assist with reporting the CGT events in the next income year's return, they became aware that the title office records showed the transfer as being in the relevant income year. Further investigation showed that this was the date that the original paperwork was submitted, despite the subsequent delays in processing. You intend to amend your relevant income year tax return to reflect the correct timing of the relevant CGT events. You intend to apply the 50% discount, the active asset reduction, and the retirement exemption to the gain.

Relevant legislative provisions: Income Tax Assessment Act 1997 paragraph 103-25(1)(b)