Capital gains tax roll-over for amalgamations of Indigenous corporations

The 2011-12 Budget included a measure to provide capital gains tax (CGT) and other roll-overs for Corporations (Aboriginal and Torres Strait Islander) Act 2006 (CATSI Act) corporations that amalgamate with one or more other CATSI Act corporations.

This measure will introduce new roll-overs into the Income Tax Assessment Act 1997 (ITAA 1997) to ensure that taxation consequences do not impede CATSI Act corporations from amalgamating to form stronger and more sustainable corporations.

This measure will provide a:

• CGT roll-over for the membership interests of members of CATSI Act corporations that amalgamate with another CATSI Act corporation where their original interests are replaced with interests in the amalgamated corporation
• roll-over for CATSI Act corporations that are amalgamating to disregard any gains or losses on their CGT assets, revenue assets, trading stock and depreciating assets that become assets of the newly amalgamated entity as part of the amalgamation process.

Once it becomes law this measure will apply to income tax assessments for the 2007-08 income year and later income years.

More information The 2011-12 Budget - Budget Paper No. 2 - Part 1 Revenue measures. Treasury proposals paper - Removing Income Tax Barriers to CATSI Act Corporation Amalgamations. Extension of the capital gains tax roll-over for conversion of a body to an incorporation.