Private ruling: Income tax - CGT - small business concessions
Date of advice: 29 May 2021
Published: August 2021
Ruling period: Year ending 30 June 2021 | Year ending 30 June 2022
Date scheme commenced: 1 July 2020

Ruling: Q1: Are you eligible to disregard the capital gain arising from the disposal of the property under paragraph 152-105(d) of the Income Tax Assessment Act 1997 (ITAA 1997)? Answer Yes. You have owned the property for more than 15 years and because you are permanently incapacitated you are eligible to disregard the capital gain from the disposal of the property. The Commissioner is satisfied that you meet the conditions of paragraph 152-105(d) of the ITAA 1997. Further information on this topic can be found by searching QC 52288 on ato.gov.au.

Relevant facts and circumstances: You are currently XX years old and a partner in a partnership that operates an agricultural business since 19XX. You own a 25% share in a property. The property has been used in the primary production business since it was acquired. Due to your age an incapacity you will transfer your share of the property to X by way of a gift. The transfer of the property will result in a capital gain. You meet the basic requirements under subdivision 152-A. You are living in an aged care home and due to your age and ill health you are currently not employed. You will be exiting the business and retiring from your role in the partnership. Subsequently you will not have the ongoing need to sign partnership financial statements, tax returns and bank documents. You will be executing a deed of retirement to leave the partnership and transfer your interest to X.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 152-105(d)