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  • Advice under development – capital gains tax issues

    We are developing advice and guidance on the following capital gains tax issues.

    [3802] Trust capital gains

    Title
    Final Taxation Determination
    Income tax: is the source concept in Division 6 of Part III of the Income Tax Assessment Act 1936 relevant in determining whether a non-resident beneficiary of a resident trust (or trustee for them) is assessed on an amount of trust capital gain arising under Subdivision 115–C of the Income Tax Assessment Act 1997?

    Registered
    6 September 2016

    Purpose
    The final Determination will set out the Commissioner's view on the taxation treatment of capital gains for a non-resident beneficiary or trustee of a resident trust.

    Expected completion
    To be advised

    Comments
    Draft TD 2019/D7 published on 30 August 2019. Comments closed 27 September 2019.

    Contact
    Karen Rooke, Tax Counsel Network
    Phone: (02) 9374 1059
    Karen.Rooke@ato.gov.au

    See also:

    • finalised consultation matter [201644] 

    [3803] Capital gain from a non-resident beneficiary of a non-fixed trust

    Title
    Final Taxation Determination
    Income tax: does Subdivision 855–A (or subsection 768–915(1)) of the Income Tax Assessment Act 1997 disregard a capital gain that a foreign resident (or temporary resident) beneficiary of a resident non-fixed trust makes because of subsection 115-215(3)?

    Registered
    6 September 2016

    Purpose
    The final Determination will set out the Commissioner's view on the taxation treatment of capital gains from non-taxable Australian property assets of a non-fixed trust.

    Expected completion
    To be advised

    Comments
    Draft TD 2019/D6 published on 30 August 2019. Comments closed 27 September 2019.

    Contact
    Karen Rooke, Tax Counsel Network
    Phone: (02) 9374 1059
    Karen.Rooke@ato.gov.au

    See also:

    • finalised consultation matter [201644] 

    [3953] Back-to-back CGT roll-overs

    Registered
    November 2018

    Purpose
    We are considering the form and content of this guidance. Paragraph 2, 3 and 49 and examples 3 and 4 of TD 2019/D1 Income tax: what is a 'restructuring' for the purposes of subsection 125-70(1) of the Income Tax Assessment Act 1997? discuss aspects of sequential transactions.

    Expected completion
    To be advised

    Contact
    Simon O'Brien, Public Groups and International
    Phone: (02) 4924 7901
    PGIPAGUnit@ato.gov.au

    [3964] Appointment of capital – CGT events E5 or E7

    Title
    Draft Taxation Determination
    Does CGT event E5 or E7 happen if the trustee of a discretionary trust appoints an amount of capital to a beneficiary (eg by special resolution) and later makes a capital distribution in Australian currency in satisfaction of the appointed interest?

    Registered
    February 2019

    Purpose
    The draft Determination will set out the Commissioner’s preliminary view on the CGT consequences of:

    • appointing an amount of capital to a beneficiary
    • the subsequent distribution of Australian currency to the beneficiary in satisfaction of the capital interest.

    Expected completion
    To be advised

    Comments
    The release of this and related Determinations (items 3965 and 3966) has been delayed due to higher priority work.

    Contact
    Justin Dearness, Tax Counsel Network
    Phone: (07) 3213 5745
    Justin.Dearness@ato.gov.au

    [3965] Australian currency denominated asset – CGT events E5 to E7

    Title
    Draft Taxation Determination
    Can an asset with a face value in Australian currency (including an Australian currency banknote or coin) be a CGT asset for CGT events E5 to E7?

    Registered
    February 2019

    Purpose
    The draft Determination will set out the Commissioner's view on whether assets with a face value in Australian currency (including Australian currency itself) can be CGT assets for CGT events E5 to E7.

    Expected completion
    To be advised

    Comments
    The release of this and related Determinations (items 3964 and 3966) has been delayed due to higher priority work.

    Contact
    Justin Dearness, Tax Counsel Network
    Phone: (07) 3213 5745
    Justin.Dearness@ato.gov.au

    [3966] Unit trust – CGT events E5 to E8

    Title
    Draft Taxation Determination
    What is the meaning of the term ‘unit trust’ in CGT events E5 to E8, and what are the interaction implications for other CGT events, in particular CGT events E4 and C2?

    Registered
    February 2019

    Purpose
    The draft Determination will set out the Commissioner’s proposed view on:

    • what is a ‘unit trust’ for CGT events E5 to E8
    • its implications for other CGT events.

    Expected completion
    To be advised

    Comments
    The release of this and related Determinations (items 3964 and 3965 has been delayed due to higher priority work.

    Contact
    Justin Dearness, Tax Counsel Network
    Phone: (07) 3213 5745
    Justin.Dearness@ato.gov.au

    [3968] Small business concessions – active asset test

    Title
    Final Taxation Determination
    Income tax: can a company that carries on a business in a general sense as described in TR 2019/1 but whose only activity is renting out an investment property claim the CGT small business concessions in relation to that investment property?

    Registered
    March 2019

    Purpose
    The final Determination will provide advice that a company that carries on a business in a general sense, but whose only activity is renting out an investment property cannot claim the CGT small business concessions.

    Expected completion
    December 2019

    Comments
    Draft TD 2019/D4 published on 5 April 2019. Comments period closed on 10 May 2019.

    Contact
    Renee George, Individuals and Intermediaries
    Phone: (07) 4753 7974
    Renee.George@ato.gov.au

    [3973] The first element of cost base and other deductible expenditure

    Title
    Final Taxation Determination
    Income tax: where a liability is assumed on acquisition of a CGT asset, is the assumed liability excluded from the cost base of the asset if expenditure on discharge of the liability is deductible?

    Registered
    May 2019

    Purpose
    The final Determination will provide the Commissioner’s view on the treatment of liabilities assumed upon acquisition of a CGT asset and whether on discharge of these liabilities, subsection 110-45(2) will apply such that they do not form part of the cost base.

    Expected completion
    To be advised

    Comments
    Draft TD 2019/D11 published on 30 October 2019. Comments period closed on 29 November 2019.

    Contact
    Matt Miller, Tax Counsel Network
    Phone: (07) 3213 6658
    Matthew.Miller@ato.gov.au

    Last modified: 04 Dec 2019QC 50316