Private ruling: Extension of time to purchase a replacement asset for the small business CGT concession
Date of advice: 26 February 2021
Published: April 2021
Ruling period: Year ended DD MM YYY
Date scheme commenced: DD MM YYYY

Ruling: Q1: Will the Commissioner exercise the discretion under section 104-190(2) of the Income Tax Assessment Act 1997 (ITAA 1997)to extend the replacement asset period in respect of the small business CGT replacement asset roll-over relief? | A1: Yes. Having considered the relevant facts, the Commissioner will apply his discretion under subsection 104-190(2) of the ITAA 1997 and allow an extension of the time to purchase a replacement asset.

Relevant facts and circumstances: You owned a small business. You sold a small business. You made a capital gain from the sale of the small business. It took an extended period to confirm that you were eligible to apply the small business CGT concessions. You applied for a Private Ruling through the ATO, requesting the Commissioner exercise his discretion under section 104-190(2). You received a Private Ruling from the ATO, granting your request. You had acquired a potential replacement assert however the sale fell through due to legal issues which could not be resolved with the vendor. You identified an opportunity to invest in a replacement asset. Unfortunately, this proposed transaction fell through due to various legal limitations. The market for business acquisition had been severely affected due to the impacts of COVID-19. You are continuing to explore several opportunities but are yet to identify another site for the proposed replacement asset.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 104-190