Private ruling: CGT - small business concessions
Date of advice: 26 November 2024
Published: 13 January 2025
Ruling period: Year ending 30 June 2025 | Year ending 30 June 2026 | Year ending 30 June 2027
Date scheme commenced: 1 July 2024

Ruling: Q1: Will the Commissioner exercise the discretion in subsection 104-190(2) of the Income Tax Assessment Act 1997 (ITAA 1997) to extend the replacement asset period to 1 August 2026? | A1: Yes. Having considered the relevant factors and your specific circumstances the Commissioner will exercise the discretion under subsection 104-190(2) of the ITAA 1997 to extend the replacement asset period. Further information on the small business replacement asset rollover can be found on our website by searching for QC 52291.

Relevant facts and circumstances: During the 20XX-XX financial year you purchased farming land. Prior to the purchase there was a lease agreement between 2 parties and the previous owners. One party was your former partner. You sold the property due to actions of your partner involving your family. You were unable to work the property on your own and needed to return interstate to be supported by family and friends. The property was sold at auction during the 2022-23 financial year. You satisfied the basic conditions to access the small business capital gains tax (CGT) concessions and applied the 50% active asset reduction and small business rollover to the gain made on the disposal. You were unable to acquire a replacement asset within 2 years due to the issues faced by your family. The significant distress and pressure on your family have impacted your ability to purchase a replacement asset. You were not in a position to know how much money you had available to fund a purchase until a particular date in the 2024-25 financial year due to legal proceedings. You have made attempts to secure a property from a particular date in the 2023-24 financial year by engaging with a number of property agents, attending auctions and viewings without success. You are seeking to locate a rural property, now that all financial matters are dealt with and you are aware of your budget.

Relevant legislative provisions: Income Tax Assessment Act 1997 subsection 104-190(2) | Income Tax Assessment Act 1997 Subdivision 152-E