Private ruling: CGT - small business concessions
Date of advice: 27 June 2024
Published: 5 August 2024
Date scheme commenced: The Partnership

Ruling: Q1: Will the sale of the subdivided Lot <number> on SP <number> comprising approximately <number> acres, located at <property address>, be a taxable supply pursuant to section 9-5 of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act)? | A1: No. Issue 2 | Q2: Will <individual name> and <individual name> meet the basic conditions for relief (under Subdivision 152-A of the Income Tax Assessment Act 1997 ) for the CGT small business concessions if the <number>-acre block is sold before <date>? | A2: Yes.

Relevant facts and circumstances: The Partnership <Individual name> and his spouse <individual name> (you) formed a partnership - <partnership name> (ABN: <number>), (the Partnership) in <year> and have since carried on a <type of enterprise>. The Partnership registered for GST from <date> and reports its GST obligation on a quarterly and cash basis. The Partnership's turnover in the <year> income year was $<amount> and you do not expect the Partnership's turnover to exceed $<number> in the <year> income year. The Partnership is only connected with <individual name> and <individual name>; it isn't connected with any other entities. No entities are affiliates of the Partnership. <Individual name> and <individual name> don't carry on any other business, other than as partners in the Partnership. Purchase of the Property On <date>, you, as joint tenants, purchased a <type> property located at <property address> (the Property) for $<amount>. Settlement took place on <date>. The Property was formally known as Lot <number> on TP<number> contained in Certificate Tittle volume <number> folio <number>. When purchased, the Property was zoned as <zoning description> and comprised approximately <number> acres, contained <number> residential premises, fenced paddocks, cattle facilities and three sealed road frontages. The Property was used for beef cattle faming by the previous owner. Since acquiring the Property, it has been used along with other properties (listed below) for <activity> in your <type of enterprise> and has been accounted for as an asset of the Partnership. All of its running costs have been claimed as an expense incurred in the running of the <type of enterprise> carried on by the Partnership. Subdivision of the Property In <year>, you decided to realign the boundaries of the <property type> and applied to subdivide the Property into <number> separate parcels, one sized <number> acres and the other sized <number> acres. The realignment and subdivision commenced in <month> <year> and was completed on <date>. The majority of the subdivision costs (such as quantity surveyors costs, soil testing etc) are yet to be paid but are expected to be funded by you/the Partnership without borrowings. The <number>acre parcel is/will be known as Lot <number> on SP<number>, and the <number>acre parcel is/will be known as Lot <number> on SP<number>. You intend to continue to use the <number>acre parcel (Lot <number>) in your <type of enterprise>. You intend to advertise for sale the <number>-acre parcel of land (Lot <number>), which is in excess of your <activity> needs, to allow you to reduce your debts. You will advertise Lot <number> for sale once the private ruling is issued. Property for sale Lot <number> comprising of <number>acres, contains a dilapidated house located on the eastern boundary of the block, a small disused milking shed, another small shed, <number> water tanks and fenced yards which are still currently used in the <type of enterprise> carried on by the Partnership but will be vacated and made available to the new owners. Excluding the building block, old sheds, driveway etc, Lot <number>'s <activity type> area comprises of approx. <number>acres. Whilst the condition of the house has deteriorated over the years, it currently contains a kitchen, bathroom, toilet facilities, a bedroom, remains connected to electricity and its windows/doors are intact. It requires a new pump, water tank and other minor repairs to return it to a liveable condition. The house has been left vacant and not used by you or any other entity to generate any form of income during your period of ownership. The house/building has not been condemned by a government agency. You provided photos of the house located on Lot <number>. Small acreages are well sought after in the area, and you expect the selling price of the <number>-acre parcel of land to be in the vicinity of $<amount> to $<amount>. You have not undertaken subdivision or land development activities in the past nor plan to undertake these activities in the future. Use of the <number>-acre parcel since its purchase The Partnership undertakes a <type of business> on entire <number>-acre property. For the entire ownership period the <number>-acre parcel was used for <type of business>, with the exception of the house block. It has not been used by you or any other entity nor used to derive rent at any time during the ownership period. Other You provided a table outlining your current and prior property ownership (solely, jointly and beneficially): Assumptions • The Partnership's turnover will be less than $<number> million for the income years ended <date> and <date>. • The Partnership will have no connected entities or affiliates (other than <individual name> and <individual name>) during the income years ended <date> and <date>. • Neither <individual name> nor <individual name> will begin to carry on any separate business before <date>. • If <individual name> and <individual name> sell the <number>-acre block before <date>, they will both make a capital gain on the sale.

Relevant legislative provisions: A New Tax System (Goods and Services Tax) Act 1999 section 9-5 | A New Tax System (Goods and Services Tax) Act 1999 section 9-40 | A New Tax System (Goods and Services Tax) Act 1999 section 40-65 | A New Tax System (Goods and Services Tax) Act 1999 Division 38 | A New Tax System (Goods and Services Tax) Act 1999 section 195-1 | Income Tax Assessment Act 1997 section 104-10 | Income Tax Assessment Act 1997 section 108-5 | Income Tax Assessment Act 1997 section 328-110 | Income Tax Assessment Act 1997 section 328-115 | Income Tax Assessment Act 1997 section 328-120 | Income Tax Assessment Act 1997 subdivision 152-A | Income Tax Assessment Act 1997 subdivision 152-B | Income Tax Assessment Act 1997 subdivision 152-C | Income Tax Assessment Act 1997 subdivision 152-D

Reasons for decision: Detailed Reasoning - Question 1: Will the sale of the subdivided Lot <number> on SP <number> comprising of approximately <number>acres, located at <property address>, be a taxable supply pursuant to section 9-5 of the New Tax System (Goods and Services Tax) Act 1999 (GST Act)? | Detailed Reasoning - Detailed reasoning: In this ruling, • unless otherwise stated, all legislative references are to the A New Tax System (Goods and Services Tax) Act 1999 (GST Act) • ITAA 1997 means the Income Tax Assessment Act 1997 • all legislative terms of the GST Act marked with an asterisk are defined in section 195-1 of the GST Act. • all reference materials, published by the Australian Taxation Office (ATO), that are referred to are available on the ATO website ato.gov.au Section 9-5 provides that you make a taxable supply if: a) you make the supply for consideration b) the supply is made in the course or furtherance of an enterprise that you carry on c) the supply is connected with the indirect tax zone (Australia) d) you are registered or required to be registered. However, the supply is not a taxable supply to the extent that it is GST-free or input taxed. Division 38 and 40 provide for certain supplies to be GST-free and input taxed respectively. As the Property contains an existing dwelling, it is relevant to consider whether the sale of Lot <number> can be considered to be a supply of residential premises and, therefore, input taxed under Division 40. Subsection 40-65(1) provides that a sale of real property is input taxed, but only to the extent that the property is residential premises to be used predominantly for residential accommodation (regardless of the term of occupation). However, subsection 40-65(2) provides that the sale will not be input taxed to the extent the residential premises are commercial residential premises or new residential premises. In this case, the Property does not meet the definition of either new residential premises or commercial residential premises under the GST Act. Section 195-1 defines 'residential premises' to mean land or a building that: a) is occupied as a residence or for residential accommodation; or b) is intended to be occupied, and is capable of being occupied, as a residence or for residential accommodation. (regardless of the term of the occupation or intended occupation) and includes a floating home. The ATO's position on what constitutes residential premises to be used predominantly for residential accommodation under section 40-65 is set out in the public ruling Goods and Services Tax Ruling GSTR 2012/5 Goods and services tax: residential premises (GSTR 2012/5). Paragraphs 6 and 7 of GSTR 2012/5provide that: 6. Premises, comprising land or a building, are residential premises under paragraph (a) of the definition of residential premises in section 195-1 where the premises are occupied as a residence or for residential accommodation, regardless of the term of occupation. The actual use of the premises as a residence or for residential accommodation is relevant to satisfying this limb of the definition. 7. Premises, comprising land or a building, are also residential premises under paragraph (b) of the definition of residential premises if the premises are intended to be occupied, and are capable of being occupied, as a residence or for residential accommodation, regardless of the term of the intended occupation. This limb of the definition refers to premises that are designed, built or modified so as to be suitable to be occupied, and capable of being occupied, as a residence or for residential accommodation. This is demonstrated through the physical characteristics of the premises. To satisfy the requirements of section 40-65, not only must the Property meet the definition of 'residential premises', but it also needs to be residential premises that is predominantly used for or capable of being used for residential accommodation (regardless of the term of occupation). This limb of section 40-65 is a single test that looks to the physical characteristics of the property to determine the premises' suitability and capability for residential accommodation. Paragraphs 10 and 11 of GSTR 2012/5 look at this aspect of section 40-65 in more detail: 10. The requirement for residential premises to be used predominantly for residential accommodation does not require an examination of the subjective intention of, or use by, any particular person. Premises that display physical characteristics evidencing their suitability and capability to provide residential accommodation are residential premises even if they are used for a purpose other than to provide residential accommodation (for example, where the premises are used as a business office). 11. Premises that do not display physical characteristics demonstrating that they are suitable for, and capable of, being occupied as a residence or for residential accommodation are not residential premises to be used predominantly for residential accommodation, even if the premises are actually occupied as a residence or for residential accommodation. For example, someone might occupy premises that lack the physical characteristics of premises suitable for, or capable of, residential accommodation (such as a squatter residing in a disused factory). Although the premises may satisfy paragraph (a) of the definition of residential premises in section 195-1, the premises are not residential premises to be used predominantly for residential accommodation. A premises must provide, at the very least, shelter and basic living facilities to satisfy the definition of 'residential premises'. This is discussed in detail in paragraph 15 of GSTR 2012/5: 15. To satisfy the definition of residential premises, premises must provide shelter and basic living facilities. Premises that do not have the physical characteristics to provide these are not residential premises to be used predominantly for residential accommodation. A premises must also be fit for human habitation or, if in a state of disrepair, readily repairable to satisfy the definition of residential premises. Paragraph 20 to 24 GSTR 2012/5 provides: Fit for human habitation 20. Premises must be fit for human habitation in order to be suitable for, and capable of, being occupied as a residence or for residential accommodation. An objective consideration of the relevant facts and circumstances determines whether residential premises are fit for human habitation. Residential premises are not fit for human habitation when they are in a dilapidated condition which prevents them being occupied for residential accommodation. 21. Residential premises that are either: • in a minor state of disrepair; or • subject to a temporary legal prohibition for occupation pending minor repairs; are still suitable for, and capable of, being occupied as a residence or for residential accommodation. 22. A partially built building is not residential premises until it becomes fit for human habitation. Contractual or legal prohibitions against residential occupation do not prevent premises from being suitable for, and capable of, providing residential accommodation. Example 3 - temporary disruption to occupation 23. Ashlea is registered as a hairdresser and owns and rents residential premises that she formerly resided in at a costal town in northern Australia. The premises are not new residential premises. 24. A tropical cyclone crosses the coast leading to windows being shattered and damage to the roof. The damage is readily repairable but Ashlea fails to make the repairs resulting in the local Council issuing a notice stating that the premises are not fit for habitation. As a result, the tenant's occupation of the premises is temporarily disrupted. Ashlea sells the premises before making the repairs. Despite the damage to the premises and the action taken by the Council, the physical characteristics of the premises show that it is suitable for, and capable of, being occupied as a residence or for residential accommodation. The sale of the premises is therefore an input taxed supply of residential premises to be used predominately for residential accommodation. Based on the information supplied, the dwelling located on Lot <number> was built and designed so as to be suitable to be occupied and capable of being occupied as a residence or for residential accommodation. Whilst over the years the dwelling has become dilapidated, left vacant and not used a residence during the period of your ownership, the dwelling currently contains the physical characteristics of residential premises. The dwelling contains a kitchen, bathroom, toilet, bedroom etc that enable it to provide basic shelter and living facilities. Despite its deteriorated condition, it merely requires a pump and water tank and other minor repairs to return it to a liveable condition. The fundamental nature of the dwelling located on Lot <number> is that of a residential premises to be used predominantly for residential accommodation. Therefore, the dwelling will satisfy the definition of 'residential premises'. The next issue to consider is to what extent your supply of Lot <number>is 'residential premises' to be used predominately for residential accommodation and therefore input taxed for GST purposes. It remains to be determined whether the sheds and surrounding <number>acres of <land type> can be considered to form part of the premise that is to be used predominantly for residential accommodation. In relation to land supplied with residential premises GSTR2012/5 provides: | Detailed Reasoning - Land supplied with a building: 46. There is no specific restriction, in the definition of residential premises, on the area of land that can be included with a building. The extent to which land forms part of residential premises to be used predominantly for residential accommodation is a question of fact and degree in each case. A relevant factor in determining this is the extent to which the physical characteristics of the land and building as a whole indicate that the land is to be enjoyed in conjunction with the residential building. The use of the land is not a determining factor in deciding if the land forms part of the residential premises. | Detailed Reasoning - Vacant land: 47. Vacant land is not capable of being occupied as a residence or for residential accommodation as it does not provide shelter and basic living facilities. Vacant land is not residential premises. Paragraph 46 of GSTR 2012/5 shows that, where it can be concluded that land on a property is to be used for the better enjoyment of the residential premises and the physical characteristics of the land as a whole indicate they are to be enjoyed in conjunction with the residential premises, the supply of the land is incidental to the supply of the residential premises on the land. In relation to other structures supplied with residential premises, the principles applicable to such structures are outlined in paragraph 78 of GSTR 2012/5: 78. A supply of a residential apartment in a building may include a garage, car-parking space, or storage area physically separate from the apartment, but within the building complex. The garage, car-parking space, or storage area is ancillary or incidental to the dominant component of the supply being the residential apartment. It can be therefore reasonably concluded that the garage, car-parking space, or storage area are to be used for the better enjoyment of the residential apartment. They do not form a dominant part of the supply. The supply is therefore a composite supply of residential premises to be used predominantly for residential accommodation. This is still the outcome where the garage, car-parking space, or storage space is separately titled to the residential apartment, if it is physically located within the building complex. 79. A supply of a garage, car-parking space, or storage area that is supplied separately to the supply of a residential unit is not an input taxed supply of residential premises to be used predominantly for residential accommodation. The supply is a taxable supply where the requirements of section 9-5 are satisfied. This may occur, for example, where a person initially buys a residential apartment from a registered developer entity without a car parking space and subsequently purchases a car parking space as a separate supply from the registered developer entity. See Example 2 at paragraph 18 of this Ruling. While paragraph 78 and 79 relate to residential apartments in a building, its principles have equal application where there is a home with separately located storage facilities, such as the sheds in your circumstances. As it is increasingly popular and sought after in the area, you expect to market and supply Lot <number> as a 'small acreage' suitable for the personal enjoyment of the purchaser. The residential premises located on Lot <number> is being supplied together with the disused milking shed, another small shed, <number> water tanks and the surrounding fenced <number> acres of vacant land in a single transaction. Whilst as part of a much larger parcel of land it is currently used for <activity type> in your <type of business>, given its size, the <number>-acres of land that surrounds the residential premises on its own is insufficient to continue to conduct a <type of enterprise>. The nature and reduced size of the land is better suited for the enjoyment of and to be used in conjunction with the residential premises. Consequently, the sheds and surrounding vacant land located on Lot <number> are to be used in conjunction with and for the better enjoyment of the residential premises and are ancillary to the supply of the residential premises. Therefore, the supply of Lot <number> in its entirety is an input taxed supply of residential premises under section 40-65 and not a taxable supply pursuant to section 9-5 of the GST Act. | Detailed Reasoning - Question 1: Will <individual name> and <individual name> meet the basic conditions for relief (under Subdivision 152-A of the Income Tax Assessment Act 1997 ) for the CGT small business concessions if the <number>-acre block is sold before <date>? | Summary: To access the CGT small business concessions you need to meet certain basic conditions listed in Subdivision 152-A of the ITAA 1997. Two of those conditions are that: • you meet either a 'CGT small business' test or a maximum net asset value test • you meet an active asset test. One way to meet the CGT small business test is if the CGT asset is a partnership asset, and your partnership is a CGT small business (which means it has an aggregated turnover of less than $2 million at specified times). Broadly, in that case, you would meet the active asset test if the CGT asset was used in the partnership's business for more than half of the period you owned the asset. <Individual name> and <individual name> both meet the CGT small business test because they're partners in the Partnership, the relevant CGT assets are interests in Lot <number>, which is a partnership asset, and the Partnership's turnover has been less than $2 million in the relevant income years. The remaining conditions will be met on the facts and assumptions of this ruling, so <individual name> and <individual name> both meet the basic conditions for CGT small business concessions. | Detailed Reasoning - To be eligible for the CGT small business concessions, you must meet (at least) four basic conditions in Subdivision 152-A.: There are four CGT small business concessions. • The 'small business 15-year exemption' in Subdivision 152-B of the ITAA 1997, which allows eligible taxpayers to disregard any capital gain. • The 'small business 50% reduction' in Subdivision 152-C of the ITAA 1997, which allows eligible taxpayers to reduce a capital gain by 50%. • The 'small business retirement exemption' in Subdivision 152-D of the ITAA 1997, which allows eligible taxpayers to disregard all or part of a capital gain in certain circumstances (broadly, where they are either over 55 or contribute the exempt amount into superannuation). • The 'small business rollover' in Subdivision 152-E of the ITAA 1997, which allows eligible taxpayers to defer, or in some cases disregard, a capital gain. While some of those concessions have extra requirements, all four share 'basic' eligibility conditions in Subdivision 152-A of the ITAA 1997. This ruling only addresses whether <individual name> and <individual name> will meet the basic eligibility conditions (given the facts and assumptions) and doesn't address whether they will qualify for any specific concession. There are four basic conditions for the CGT small business concessions. They're listed in subsection 152-10(1) of the ITAA 1997. A CGT event must happen in relation to a CGT asset of yours in the relevant income year. • The event would (absent CGT small business relief) have resulted in a capital gain. • You must either meet a CGT small business entity test or satisfy a maximum net asset value test. • The CGT asset must satisfy the active asset test. Additional basic conditions apply where the CGT asset is a share in a company or an interest in a trust, but they aren't relevant to this ruling. The first and second conditions will be met because a CGT event will happen if <individual name> and <individual name> sell Lot <number>, and they make a capital gain. The first basic condition requires that CGT event must happen in relation to a CGT asset of yours in the relevant income year. CGT event A1 happens if you dispose of a CGT asset, which means there's a change of ownership from you to another entity: see section 104-10 of the ITAA 1997. Section 108-5 of the ITAA 1997 says a CGT asset is any kind of property, or a legal or equitable right that isn't property, and land and buildings are examples of CGT assets. The first basic condition will be met. <Individual name> and <individual name> currently have equal interests in Lot <number> (which is land), and their interests in the block are CGT assets because they're property. We've assumed that <individual name> and <individual name> will sell Lot <number> before <number>, which means that there'll be a change of ownership in their CGT assets to the buyer. Therefore, CGT event A1 will happen in relation to <individual name> and <individual name> CGT assets. We've assumed that <individual name> and <individual name> will make capital gains from the sale, which means that the second condition (there would be a capital gain but for CGT small business relief) will also be met. The third condition is met: <individual name> and <individual name>'s partnership is a CGT small business entity, and their CGT assets are interests in a partnership asset. The third basic condition requires either that you meet a CGT small business entity test, or a maximum net asset value test. Broadly, the CGT small business test requires that either you or a related entity must be a CGT small business entity. The effect of paragraph 152-10(1)(c) of the ITAA 1997 is that you may meet it if either: • you're a CGT small business entity for the income year • you're a partner in a partnership that's a CGT small business entity for the income year, and the CGT asset is an interest in an asset of the partnership • you're a partner in a partnership that's a CGT small business entity for the income year (and the CGT asset isn't an interest in a partnership asset), and the partnership carries on business in relation to the CGT partnership asset • you have an affiliate or entity connected with you that's a CGT small business entity for the income year, and the relevant business entity carries on the business in relation to the CGT asset. You will be a CGT small business entity if you carry on business and your aggregated turnover for either the current income year or previous year was less than $2 million: see subsection 152-10(1AA) of the ITAA 1997 read with section 328-110 of the ITAA 1997. Aggregated turnover means the annual turnovers of you, your affiliates, and entities connected with you, where 'annual turnover' means ordinary income an entity derives in the ordinary course of carrying on business: sections 328-115 and 328-120 of the ITAA 1997. Partnerships are treated as entities for tax purposes: see section 960-100 of the ITAA 1997. The Partnership will qualify as a CGT small business entity. • It has carried on business since <year>. • The Partnership's annual turnover was less than $2 million for the <year> income year, and we've assumed that its annual turnover will be below $2 million for the <year> and <year> income years. • The Partnership's aggregated turnover will be equal to its annual turnover because it doesn't have any connected entities or affiliates (except for <individual name> and <individual name>, and they don't carry on business as individuals other than as partners in the Partnership). • Since it will have carried on business and will have had an aggregated turnover below the $2 million threshold for both the current and previous income years, it meets the test for a CGT small business entity for the ruling period. The relevant CGT assets are partnership assets. <Individual name> and <individual name> jointly own Lot <number>. Its financial statements record the land as a Partnership asset, suggesting that <individual name> and <individual name> have contributed their interests in the land towards the Partnership. It follows that <individual name> and <individual name> meet the CGT small business condition. They're partners in the Partnership, which is a CGT small business entity, and their CGT assets are interests in Lot <number>, which is a Partnership asset. It follows that <individual name> and <individual name> meet the third basic condition, relying on the CGT small business entity test; we don't need to consider whether they meet the maximum net asset value test. The fourth condition is met: Lot <number> meet the active asset test because at the assumed sale time it will have been used in the Partnership's business for more than half of the relevant ownership period. The fourth condition requires that the CGT asset satisfies the active asset test. If you held the CGT asset for 15 years or less, it will satisfy the active asset test if it was an active asset of yours for at least half the period from when you acquired it to the CGT event: section 152-35 of the ITAA 1997. Relevantly, a CGT asset will be an active asset if you own it, and it's used in the course of carrying on a business (whether alone or in partnership) by you: paragraph 152-40(1)(a) of the ITAA 1997. There are some exceptions where CGT assets are excluded from being active assets, including whether the asset's main use (by you) was to derive rent: see subsection 152-40(4) of the ITAA 1997. The ATO website has guidance about applying the active asset test to subdivided land. [1] When land is subdivided and sold, each subdivided parcel should be treated as a separate asset. For example, if only part of the land was used in the business, only subdivided parcels corresponding to land which was used in the business can qualify as active assets. Parcels which were vacant or only used for other purposes can't qualify as active assets. Here, <individual name> and <individual name>'s interests in the land were active assets. • The entire <number>-acres, including Lot <number>, was used for <activity> in the Partnership's <type of business>. • Since a partner, for the purposes of the active asset test, will be treated as carrying on a business if they carry it on in partnership, the land was used in the course of a business <individual name> and <individual name> carry on. • Therefore, the <number>-acres is an active asset. • Treated as a separate asset, the Lot <number> is still an active asset. It was used for <activity> before and continues to be used for <activity> after the subdivision. The subdivision doesn't affect the <number>-acre block's status. • We're satisfied that on these facts, it's reasonable to characterise the entire <number>-acres of Lot <number> as an active asset: at least <number> acres or two-thirds of the area was used for <activity>, and only the <number>-acre house block wasn't used in the business. • Lot <number>, including the house, was never used to derive rent so the exclusion for 'rent' doesn't apply. <Individual name> and <individual name>'s interests in Lot <number> will satisfy the active asset test. <individual name> and <individual name> owned their interests in the land since <year>, which means they will have held it for less than 15 years by the assumed sale (on or before <date>). The entire <number>-acres, including the <number>-acres of Lot <number> (apart from the house block portion) has always been used for <activity> and there's been no change in how it was used in the ownership period until the ruling application. Even if Lot <number> stops being used in the business sometime before the sale, the asset will have been an active asset for more than half of the relevant ownership period. Therefore, it will satisfy the active asset test in section 152-35 of the ITAA 1997. | Detailed Reasoning - Conclusion: <individual name> and <individual name>s interests in Lot 2<number>pass the basic conditions for CGT small business relief.: <Individual name> and <individual name>'s interests in Lot <number> pass the four basic conditions for CGT small business relief in Subdivision 152-A of the ITAA 1997. • If <individual name> and <individual name> sell Lot <number> on or before <date>, they will have a CGT event (A1) happen to their interests in it. • We've assumed that <individual name> and <individual name> will have capital gains from that CGT event. • <Individual name> and <individual name> pass the CGT small business test because they're partners in the Partnership and Lot <number> is the Partnership's asset. • <Individual name> and <individual name>'s interests in Lot <number> pass the active asset test because the block was used for <activity>in the Partnership's business throughout the relevant ownership period. <Individual name> and <individual name> qualify for the basic conditions for CGT small business relief in Subdivision 152-A of the ITAA 1997. However, they will need to separately consider whether they will qualify for any particular CGT small business concession as some have extra requirements. [1] ATO (Aug 2023) Active asset test | Australian Taxation Office (ato.gov.au) (QC 52271), accessed 5 April 2024.