Private ruling: Division 615 roll-over
Date of advice: 17 March 2026
Published: 4 May 2026
Ruling period: 1 July 2025 to 30 June 2026
Date scheme commenced: 1 July 2025

Ruling: Q1: Can the Taxpayer choose to obtain a roll-over under Division 615 of the ITAA 1997 [1] ? | A1: Yes.

Relevant facts and circumstances: The Trust The Trust is a unit trust that was established by the Trust Deed on XXXX. The Trust Deed has never been amended. The Trustee is the sole trustee of the Trust and has been since the Trust's establishment. The Trust is a resident of Australia for taxation purposes. As at XXXX, the Taxpayer held X Units in the Trust. The Taxpayer will be an Australia resident for taxation purposes at all relevant times. Proposed Restructure In anticipation of a potential listing on the ASX of A Co, it is proposed that the following steps, collectively referred to as the Proposed Restructure, will be undertaken in the income year ended 30 June 2026. a. a new company limited by shares, A Co, will be established; b. at a time referred to as the Completion Time, the Unitholders will transfer their Units to A Co and, in exchange, A Co will issue Shares to each Unitholder so that after the issue of Shares, each former Unitholder has Shares of a whole number and in the same percentage as the Units that they previously owned in the Trust, and nothing else; c. at (and immediately after) the Completion Time, the Unitholders will own all of the Shares in A Co; and d. within two months after the Completion Time, A Co will choose that section 615-65 of the ITAA 1997 applies. The Shares issued by A Co to the Unitholders will not be redeemable shares. The Shares issued by A Co to the Unitholders will be ordinary shares and immediately after the Completion Time, this will be the one and only class of shares in A Co. The Shares issued by A Co to the Unitholders will carry the same rights as the Units.

Relevant legislative provisions: Part 4A of the Financial Sector (Transfer and Restructure) Act 1999 | Section 104-10 of the ITAA 1997 | Division 615 of the ITAA 1997 | Section 615-1 of the ITAA 1997 | Section 615-5 of the ITAA 1997 | Section 615-15 of the ITAA 1997 | Section 615-20 of the ITAA 1997 | Section 615-25 of the ITAA 1997 | Section 615-30 of the ITAA 1997 | Section 615-35 of the ITAA 1997 | Section 615-65 of the ITAA 1997 | Subdivision 615-B of the ITAA 1997 | Section 960-130 of the ITAA 1997 | Subsection 995-1(1) of the ITAA 1997

Reasons for decision: Summary: Division 615 provides a roll-over that allows owners of shares in a company or units in a trust to exchange their shares or units for shares in another company as part of a business restructure, allowing owners a choice for the restructure to be tax neutral. [2] Subsection 615-5(1) provides that you can choose to obtain a roll-over if: (a) you are a *member of a company or a unit trust (the original entity ); and (b) you and at least one other entity (the exchanging members ) own all the *shares or units in it; and (c) under a *scheme for reorganising its affairs, the exchanging members *dispose of all their shares or units in it to a company (the interposed company ) in exchange for shares in the interposed company (and nothing else); and (d) the requirements in Subdivision 615-B are satisfied. | Detailed Reasoning - 615-5(1)(a): In relation to an entity, subsection 995-1(1) states that 'member' has the meaning given by section 960-130. Item 3 of the table in subsection 960-130(1) provides that beneficiaries, unitholders, or objects of the trust, are members where the entity is a trust (except public trading trusts). Where a trust is a public trading trust, item 5 of the table in subsection 960-130(1) provides that unitholders are members. The Taxpayer holds X Units. It is a unitholder in the Trust, and therefore a 'member' of the Trust. The requirement in paragraph 615-5(1)(a) will therefore be satisfied. | Detailed Reasoning - 615-5(1)(b) and 615-5(1)(c): Subsection 995-1(1) provides that you dispose of a CGT asset in the circumstances specified in section 104-10. Subsection 104-10(2) states that you dispose of a CGT asset if a change of ownership occurs from you to another entity. 'Scheme' is defined in subsection 995-1(1) as any arrangement, scheme, plan, proposal, action, course of action or course of conduct, whether unilateral or otherwise. The Taxpayer together with the other Unitholders own all of the Units. Together, they are the 'exchanging members' for the purposes of Division 615. The Proposed Restructure is being undertaken in anticipation of a potential listing on the ASX of A Co. The Proposed Restructure will be a scheme for reorganising the affairs of the Trust for the purposes of paragraph 615-5(1)(c). Under the Proposed Restructure, the Taxpayer and the other Unitholders as the exchanging members will transfer their Units to A Co. In transferring their Units to A Co, there will be a change in ownership in the Units from the Unitholders to A Co. There will therefore be a disposal of all of the Units to A Co by the exchanging members. In exchange, the exchanging members will be issued Shares in A Co (and nothing else). The requirements in paragraphs 615-5(1)(b) and (c) will therefore be satisfied. | Detailed Reasoning - 615-5(1)(d) and the requirements in Subdivision 615-B: There are five further requirements in Subdivision 615-B that need to be satisfied. However, there is no restructure instrument under Part 4A of the Financial Sector (Transfer and Restructure) Act 1999 and section 615-35 will not be applicable. Each of the four remaining requirements in Subdivision 615-B is discussed below. | Detailed Reasoning - 615-15 - Interposed company must own all the original interests: Section 615-15 provides that the interposed company must own all the shares or units in the original entity immediately after the time (the completion time ) all the exchanging members have had their shares or units in the original entity disposed of, redeemed or cancelled under the scheme. Under the Proposed Restructure, the interposed company, being A Co, will own all of the units in the original entity, being the Units, immediately after the Completion Time. The requirement in section 615-15 will therefore be satisfied. | Detailed Reasoning - 615-20 - Requirements relating to your interests in the original entity: Section 615-20 provides the following: (1) Immediately after the completion time, each exchanging member must own: (a) a whole number of *shares in the interposed company; and (b) a percentage of the shares in the interposed company that were issued to all the exchanging members that is equal to the percentage of the shares or units in the original entity that were: (i) owned by the member; and (ii) disposed of, redeemed or cancelled under the *scheme. (2) The following ratios must be equal: (a) the ratio of: (i) the *market value of each exchanging member's *shares in the interposed company; to (ii) the market value of the shares in the interposed company issued to all the exchanging members (worked out immediately after the completion time); (b) the ratio of: (i) the market value of that member's shares or units in the original entity that were disposed of, redeemed or cancelled under the *scheme; to (ii) the market value of all the shares or units in the original entity that were disposed of, redeemed or cancelled under the scheme (worked out immediately before the first disposal, redemption or cancellation). ... (3) Either: (a) you are an Australian resident at the time your *shares or units in the original entity are disposed of, redeemed or cancelled under the *scheme; or (b) if you are a foreign resident at the time: (i) your shares or units in the original entity were *taxable Australian property immediately before that time; and (ii) your shares in the interposed company are taxable Australian property immediately after the completion time. Under the Proposed Restructure, the exchanging members, being the Taxpayer together with the other Unitholders, will transfer all of their Units to A Co, and in exchange, A Co will issue Shares of a whole number and in the same percentages as the Units that were owned by the exchanging member, and nothing else. Immediately after the Completion Time, each exchanging member will own a whole number of Shares in the interposed company, being A Co, in the same percentage as the Units they owned in the original entity, being the Trust, immediately before they were disposed of under the scheme, being the Proposed Restructure. The requirements in subsection 615-20(1) will therefore be satisfied. Under the Proposed Restructure, the percentage and rights of the Shares owned in A Co by each exchanging member immediately after the Completion Time will be the same as the percentage and rights of the Units that they owned in the Trust before the transfer under the Proposed Restructure. The exchanging members will own all of the Shares in A Co and will receive nothing else in A Co. Considering the ratios in paragraphs 615-20(2)(a) and (b), the ratio of the market value of each exchanging member's Shares in A Co to the market value of the Shares in A Co issued to all exchanging members immediately after the Completion Time will be equal to the ratio of the market value of each exchanging member's Units in the Trust that will be disposed of under the Proposed Restructure to the market value of all Units in the Trust that will be disposed of immediately before the first disposal under the Proposed Restructure. The requirements in subsection 615-20(2) will therefore be satisfied. The Taxpayer will be an Australian resident at all relevant times, including the time of the Proposed Restructure. The requirement in subsection 615-20(3) will therefore be satisfied. | Detailed Reasoning - 615-25 - Requirements relating to the interposed company: Section 615-25 provides the following requirements in relation to the shares in the interposed company: (1) The *shares issued in the interposed company must not be *redeemable shares. (2) Each exchanging member who is issued *shares in the interposed company must own the shares from the time they are issued until at least the completion time. (3) Immediately after the completion time: (a) the exchanging members must own all the *shares in the interposed company; or (b) entities other than those members must own no more than 5 shares in the interposed company, and the *market value of those shares expressed as a percentage of the market value of all the shares in the interposed company must be such that it is reasonable to treat the exchanging members as owning all the shares. The shares issued in the interposed company, being the Shares in A Co, under the Proposed Restructure will not be redeemable shares. Each exchanging member, being the Taxpayer and the other Unitholders, will own the Shares in A Co from the time they are issued until at least the Completion Time. Immediately after the Completion Time, the exchanging members will own all of the Shares in A Co. The requirements in section 615-25 will therefore be satisfied. | Detailed Reasoning - 615-30 - Interposed company must make a particular choice: Section 615-30 provides the following: (1) Unless subsection (2) applies, the interposed company must choose that section 615-65 applies. (2) The interposed company must choose that a *consolidated group continues in existence at and after the completion time with the interposed company as its *head company, if: (a) immediately before the completion time, the consolidated group consisted of the original entity as head company and one or more other members (the other group members ); and (b) immediately after the completion time, the interposed company is the head company of a *consolidatable group consisting only of itself and the other group members. (3) A choice under subsection (1) or (2) must be made: (a) within 2 months after the completion time, if the choice is under subsection (1); or (b) within 28 days after the completion time, if the choice is under subsection (2); or (c) within such further time as the Commissioner allows. ... Immediately before the Completion Time, the original entity, being the Trust, was not the head entity of a consolidated group. Therefore, subsection 615-30(2) will not apply and the interposed company, being A Co, must choose that section 615-65 applies within 2 months after the Completion Time, or within such further time as the Commissioner allows. Under the Proposed Restructure, within two months after the Completion Time, A Co will choose that section 615-65 applies. The requirement in section 615-30 will therefore be satisfied. Accordingly, all the requirements in Subdivision 615-B will be satisfied. | Detailed Reasoning - Conclusion: All requirements in subsection 615-1(1) will be satisfied under the Proposed Restructure. Accordingly, the Taxpayer can choose to obtain a roll-over under Division 615 for the transfer of their Units to A Co under the Proposed Restructure. [1] All legislative references in this Document are to the ITAA 1997 unless otherwise indicated. [2] Section 615-1 of the ITAA 1997.

Does IVA apply to this private ruling?: Part IVA of the Income Tax Assessment Act 1936 contains anti-avoidance rules that can apply in certain circumstances where you or another taxpayer obtains a tax benefit, imputation benefit or diverted profits tax benefit in connection with an arrangement. | If Part IVA applies, the tax benefit or imputation benefit can be cancelled (for example, by disallowing a deduction that was otherwise allowable) or you or another taxpayer could be liable to the diverted profits tax. | We have not fully considered the application of Part IVA to the arrangement you asked us to rule on, or to an associated or wider arrangement of which that arrangement is part. | If you want us to rule on whether Part IVA applies, we will need to obtain and consider all the facts about the arrangement which are relevant to determining whether Part IVA may apply. | For more information on Part IVA, go to our website ato.gov.au/gaar .