Private ruling: Income Tax – Small Business Concessions – Active Asset Test
Date of advice: 11 October 2018
Published: December 2018
Ruling period: Year ended 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Will the property at XX YYY Street satisfy the active asset test? | A1: Yes. You satisfy the conditions of the active asset test as you have used the asset for at least 7.5 years in the course of carrying on a business and the exceptions do not apply. Further information can be found by searching 'QC 44192' on ato.gov.au

Relevant facts and circumstances: You and your spouse purchased a property as joint tenants during or around mth/19XX. From 19XX onwards, a business that you are connected with has operated from one of the units in the property. The remaining commercial space has been leased to various tenants over the years. The business occupies XX percent of the total floor space of the property. You are considering selling the property and advise that a contract would be signed between XX/mth and XX/mth/20XX. The rental income generated by the property for the year ended 30 June 20XX was $X. The business income generated by the business for the year ended 30 June 20XX was $X The rental income generated by the property for the year ended 30 June 20XX was $X. The business income generated by the business for the year ended 30 June 20XX was $X. Although accounts for the year ended 30 June 20XX have not yet been finalized, the draft position indicates the comparative levels of business and rental income will be in similar proportion to proceeding years. Additionally, the comparative levels of business and rental income will remain consistent through to the date of potential sale.

Relevant legislative provisions: Income Tax Assessment Act 1997 paragraph 152-10(1)(d) | Income Tax Assessment Act 1997 section 152-35 | Income Tax Assessment Act 1997 section 152-40