Private ruling: CGT - s mall business concession
Date of advice: 12 August 2025
Published: 20 October 2025
Ruling period: Year ended 30 June 20XX
Date scheme commenced: 1 July 19XX

Ruling: Q1: Will the Commissioner exercise the discretion under subsection 152-80(3) of the Income Tax Assessment Act 1997 (ITAA 1997) to extend the time limit until 30 June 2024 to allow the CGT small business concessions to be applied to the disposal of the 50% interest in Property 1 acquired by the Estate in October 19XX? | A1: No | Q2: Will the Commissioner exercise the discretion under subsection 152-80(3) of the ITAA 1997 to extend the time limit to allow the CGT small business concessions to be applied to the disposal of the interests in Property 2? | A2: Decline to rule

Relevant facts and circumstances: On X February 19XX the deceased passed away. On XX August 19XX, a deed of family arrangement was entered into. As a result of the deed of family arrangement the Estate acquired a XX% interest in Property 1. The deceased carried on a livestock business on Property 1 from acquisition until his death in 19XX. On XX February 20XX, Property 1 was sold.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 128-15 | Income Tax Assessment Act 1997 section 152-80 | Income Tax Assessment Act 1997 section 152-10

Reasons for decision: Summary: Question 1 - d etailed reasoning Section 152-80 of the ITAA 1997 explains that the beneficiaries of a trust established by the will of a deceased individual can apply the small business CGT concessions in the same way the deceased would have been entitled to immediately before their death in respect of the sale of the deceased's CGT assets. For the beneficiaries to apply the small business CGT concessions in the same way as the deceased would have been entitled to the asset must: • Form part of the deceased estate; and • The CGT asset must happen to that asset within 2 years of the individuals death. The Commissioner can exercise discretion and extend the 2-year time limit (subsection 152-80(3)). For the deceased to have been entitled to the small business CGT concessions immediately before their death the deceased would need to satisfy the basic conditions in section 152-10 of the ITAA 1997. Application to your circumstances The first condition under section 152-10 of the ITAA 1997 is that a CGT event happens in relation to a CGT asset of yours in an income year. For this to be satisfied, the individual would need to have owned the asset immediately prior to their death. Section 152-80 is not applicable in the circumstances as the deceased did not own the asset immediately before their death. The Estate acquired the asset after his death, by way of deed of family arrangement. Therefore, the deceased would not have been entitled to apply the small business CGT concessions as immediately before his death he would not have satisfied the basic conditions as he did not own the asset. The asset was acquired by the Estate in 1999 after the deceased passed. Question 2 - d etailed reasoning We will not make a private ruling in relation to your request, on behalf of the Estate, about capital gains tax, as discussed. This is because we will not make a ruling based on certain assumptions and the accuracy of your ruling would depend on the following assumptions: • Who originally acquired the asset. • What interests were held in the asset at the time of sale. The Commissioner does not believe that further information can be sought to find basis on which the Commissioner could make all necessary assumptions to make a decision on the questions raised in the private ruling application. Therefore, the Commissioner has decided to decline to rule on the application in accordance with paragraphs 359-35(2)(a) and 357-110(1)(a) of Schedule 1 to the Tax Administration Act 1953 (TAA).