Private ruling: Capital gains tax
Date of advice: 23 February 2026
Published: 7 April 2026
Ruling period: Year ending 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Will the Commissioner allow an extension of time under section 103-25 of the Income Tax Assessment Act 1997 (ITAA 1997) for you to exercise the absence choice in accordance with section 118-145 of the ITAA 1997? | A1: Yes. Based on the information provided to the Commissioner, The Commissioner will allow an extension of time under section 103-25 of the Income Tax Assessment Act 1997 (ITAA 1997) for you to exercise the absence choice in accordance with section 118-145 of the ITAA 1997. Part 3-1 and Part 3-3 of the ITAA 1997 relate to capital gains and losses - general and special topics. Section 118-145 of the ITAA 1997 is in Part 3-1 of the ITAA 1997. Subsection 103-25 (1) of the ITAA 1997 provides that a choice you make under Part 3-1 or Part 3-3 of the ITAA 1997 must be made: (a) by the day you lodge your income tax return for the income year in which the relevant capital gains tax (CGT) event happened; or (b) within a further time allowed by the Commissioner. Subsection 103-25(2) of the ITAA 1997 provides that the way you prepare your income tax return is sufficient evidence of making the choice. However, as outlined in ATO Interpretative Decision ATO ID 2003/103 Capital Gains Tax Capital gains tax: Choice and the small business roll-over , a taxpayer who did not consider the CGT concessions and accordingly included a capital gain in their income tax return has not made a choice and can, if the Commissioner allows further time, later make a choice for a CGT concession and amend their tax return to reduce or disregard the capital gain. You were not aware that you could use the absence rule in Section 118-145 of the ITAA 1997 as your former tax agent did not make you aware of this section. As you were not aware that you could exercise the absence choice by the time of lodging your tax return, it cannot be said that you made a choice. Therefore, the Commissioner will allow extra time for you to make the absence choice.

Relevant facts and circumstances: You and your spouse had a property. A contract to sell the property was entered into in a previous year. You lodged your income tax return for the relevant income year declaring a capital gain for the property. Your former tax agent did not make you aware that you may be able to access the absence rule under Section 118-145 of the Income Tax Assessment Act 1997 .

Relevant legislative provisions: Income Tax Assessment Act 1997 section 103-25 | Income Tax Assessment Act 1997 section 118-145