15-year exemption - capital gains tax concession for small business

Introduction

This concession may exempt a capital gain from a business asset that you have owned for at least 15 years.

To qualify for the 15-year exemption, you must first satisfy the basic conditions that apply to all the capital gains tax (CGT) small business concessions. You must then satisfy the additional conditions that apply specifically to the 15-year exemption.

For more information about the basic conditions, see Capital gains tax (CGT) concessions for small business - overview

Interaction with other concessions and losses

If you are eligible for the 15-year exemption, the other CGT concessions will not apply because the whole gain is exempt.

There is no need to offset the gain with any current year or prior capital losses before you apply the 15-year exemption. This allows you to use these capital losses to offset other capital gains that are not eligible for the 15-year exemption.

Exceptions to the 15-year requirement

Different rules may apply to the 15-year ownership period if the asset was previously subject to a roll-over because of a marriage breakdown or a loss, destruction or compulsory acquisition.

Additional conditions

If you are a sole trader or a partner in a partnership, you can use the 15-year exemption if:

• a CGT event happened to an asset of yours
• you continuously owned the asset for the 15-year period ending just before the CGT event
• the asset was an active asset for at least 7½ years during the period you owned it, and
• at the time the CGT event happened you were either
• aged 55 years or more and the event happened in connection with your retirement, or
• permanently incapacitated.

There are different conditions if your asset was a share in a company or an interest in a trust, or the asset was owned by a company or trust.

More information

Capital gains tax (CGT) concessions for small business - overview 50% active asset reduction - capital gains tax concession for small business Roll over - capital gains tax concession for small business Retirement exemption - capital gains tax concession for small business Guide to capital gains tax concessions for small business Advanced guide to capital gains tax concessions for small business Small business entity concessions - home