Private ruling: CGT 15-year exemption
Date of advice: 20 September 2022
Published: December 2022
Ruling period: Year ended 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Do you meet the conditions to apply the small business 15-year exemption under Subdivision 152-B of the Income Tax Assessment Act 1997 (ITAA 1997) to disregard the capital gain made on the disposal of the property? | A1: Yes.The basic conditions have been satisfied, you owned the property for more than 15 years, you are over 55 and the event occurred in connection with your retirement. Therefore, you can choose to apply the 15-year exemption and disregard any capital gain made in relation to the disposal of the property.

Relevant facts and circumstances: Individual A and B jointly acquired a property more than 15 years ago. A Partnership of Individual A and B carried on a business on the property. A Trust also carried on a business on the property. Individual A and B are the beneficiaries of the Trust, together having 50% each voting control. In the 20XX-XX financial year the property was destroyed by bushfire, which resulted in loss of livestock and extension damage to fencing and infrastructure on the property. Due to the extensive damage on the property, you sold the rest of the livestock that had survived. During the repair work on the property, you both suffered severe health complications and were unable to continue with the business. You have advised you meet the $6 million maximum net asset value (MNAV) test. You have both retired and are over 55 years of age. The property was sold in the 20XX-XX financial year.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 152-10 | Income Tax Assessment Act 1997 section 152-105 | Income Tax Assessment Act 1997 Subdivision 152-B