Private ruling: CGT – disposal - artwork
Date of advice: 11 December 2017
Published: April 2018
Ruling period: Year ended 30 June 2018
Date scheme commenced: 1 July 2017

Ruling: Q1: Did capital gains tax (CGT) event A1 occur upon the disposal of the collectables? | A1: Yes | Q2: Are you entitled to disregard any capital gain or capital loss made from the disposal of the collectables? | A2: Yes CGT event A1 occurs when you dispose of a CGT asset (section 104-10 of the Income Tax Assessment Act 1997 (ITAA 1997)). A collectable, such as your items are considered to a CGT asset that is mainly used or kept for your own personal use or enjoyment (section 108-10 of the ITAA 1997). Subsection 104-10(5) of the ITAA 1997 states that a capital gain or capital loss is disregarded if you acquired the asset before 20 September 1985. In your case, we consider that CGT event A1 occurred upon the sale of the collectable items. As you acquired the items before 20 September 1985, any capital gain or capital loss made from the A1 event would be disregarded.


Relevant legislative provisions: Income Tax Assessment Act 1997 section 104-10 | Income Tax Assessment Act 1997 section 108-10


Relevant facts and circumstance: You produced a number of works of collectable items (the items) before 20 September 1985, which were exhibited at various locations around the country. | You retained the items as part of your own collection. | The items have been stored for over XX years. | You decided to display the items with the intention of selling the items. | The items were sold to public collectors. | You received $X as the proceeds from the sale of the items. | You were in the business of producing collectable items. | You have retired from this business; however you continue to produce collectable items for your own personal enjoyment.