Private ruling: Capital gains tax-small business concessions-50% active asset reduction
Date of advice: 21 February 2019
Published: May 2019
Ruling period: Year ended 30 June 201X
Date scheme commenced: 1 July 201X

Ruling: Q1: Do you satisfy the conditions for the small business 50% reduction pursuant to section 152-200 of the Income Tax Assessment Act 19 97 (ITAA1997) in relation to the sale of your share of the property? | A1: Yes, based on the information provided you satisfy the basics conditions under section 152-10 of the ITAA 1997 as you satisfy the maximum net asset value test and the asset was an active asset for a total of at least half of the period of ownership. Accordingly, you are eligible to apply the 50% active asset reduction to the sale of your share of the property.

Relevant facts and circumstances: In XX/20XX you and Z, jointly purchased a property. You and Z are partners in a partnership. The partnership operated a business on the property for more than half the time the property was owned by the partners. The partnership was a small business entity during the income years that it carried on the business. You satisfy the maximum net asset value test under section 152-15 of the ITAA 1997. The property was sold in XX/20XX. A capital gain was made on the sale of the property.

Relevant legislative provisions: Income Tax Assessment Act 1997 Section 152-10 | Income Tax Assessment Act 1997 Section 152-35 | Income Tax Assessment Act 1997 Paragraph 152-35(1)(a). | Income Tax Assessment Act 1997 Section 152-205