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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
    Draft 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 draft Determination will set out proposed clarification on the taxation treatment of capital gains for a non-resident beneficiary or trustee of a resident trust.

    Expected completion
    August 2019

    Comments
    Targeted consultation has now ended. We are considering comments and issues raised which will be taken into account in developing the draft Determination.

    Contact
    PAGPW&IC@ato.gov.au

    See also:

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

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

    Registered
    6 September 2016

    Purpose
    The draft Determination will set out proposed clarification on the taxation treatment of capital gains from non-taxable Australian property assets of a non-fixed trust.

    Expected completion
    August 2019

    Comments
    Targeted consultation has now ended. We are considering comments and issues raised which will be taken into account in developing the draft Determination.

    Contact
    PAGPW&IC@ato.gov.au

    See also:

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

    Title
    Draft Taxation Determination
    Capital gains tax: if a CGT roll-over contains a condition that entities who own interests can acquire or receive 'nothing else', can the condition be satisfied if, after the transaction for which that CGT roll-over is sought, another transaction is planned to happen under which the same entities will acquire or receive something?

    Registered
    November 2018

    Purpose
    The draft Determination will set out our preliminary view that the condition will not be satisfied in the instance described.

    Expected completion
    July 2019

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

    [3959] CGT cost base – rental property

    Title
    Draft Practical Compliance Guideline
    Calculation of CGT cost base for a rental property and balancing adjustment amounts for depreciating assets in the rental property where depreciation has either been claimed or disallowed

    Registered
    November 2018

    Purpose
    The draft Guideline will provide proposed practical guidance in the situation where a rental property is sold and depreciation has been claimed.

    Expected completion
    December 2019

    Contact
    Kevin Westbrook, Individuals
    Phone: (07) 3119 9847
    Kevin.Westbrook@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 proposed 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
    Late 2019

    Contact
    Glenn Davies, Tax Counsel Network
    Phone: (07) 3213 5327
    Glenn.Davies@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 provide proposed clarification of 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
    Late 2019

    Contact
    Glenn Davies, Tax Counsel Network
    Phone: (07) 3213 5327
    Glenn.Davies@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
    Late 2019

    Contact
    Glenn Davies, Tax Counsel Network
    Phone: (07) 3213 5327
    Glenn.Davies@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
    September 2019

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

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

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

    Title
    Draft Taxation Determination
    Income tax: is expenditure upon discharge of a liability to which section 112-35 of the Income Tax Assessment Act 1997 applies expenditure to which subsection 110-45(2) of that Act applies?

    Registered
    May 2019

    Purpose
    The draft Determination will provide the Commissioner’s proposed 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

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

    Last modified: 05 Jul 2019QC 50316