Private ruling: CGT - extension of time rollover relief
Date of advice: 22 February 2024
Published: 15 April 2024
Ruling period: Year ending 30 June 20YY | Year ending 30 June 20YY
Date scheme commenced: 1 July 20YY

Ruling: Q1: Will the Commissioner exercise the discretion under subsection 104-190(2) of the Income Tax Assessment Act 1997 (ITAA 1997) to grant an extension of time to DD MM 20YY to acquire a replacement asset? | A1: Yes. You have actively looked for a replacement asset within the 2 year replacement asset period and conducted due diligence on those businesses identified, however you have not successfully found and acquired a business as a replacement asset that meets your experience and knowledge. You engaged a business broker to assist with the search and are continuing to look at businesses that are within the field of your knowledge. After reviewing the facts, the Commissioner will apply the discretion under subsection 104-190(2) of the ITAA 1997 and allow an extension of time to DD MM 20YY to acquire a replacement asset.

Relevant facts and circumstances: In the 20YY-YY income year you chose to use the small business rollover to defer capital gains that you made. The date of the capital gains tax (CGT) event was DD MM 20YY. You have considered a number of businesses as potential replacement assets. You completed due diligence on these businesses and have provided an offer on one of the businesses, which was rejected. The other businesses were not found suitable as replacement assets. You engaged a Business Broker to assist with your search for a business to acquire as a replacement asset. You have an interest and knowledge in a particular field and have been looking to acquire a business in that field. You are continuing to look for a suitable business as a replacement asset that is within your price range and that is a good fit for your expertise and knowledge.

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