• Passively-held assets

    If you do not carry on a business, you may be eligible for the concessions if, in the year the capital gains tax (CGT) event happens:

    • your asset is used, or held ready for use in, or inherently connected with, a business carried on by your affiliate, or an entity connected with you
    • that entity has an aggregated turnover of less than $2 million.

    There is a special rule for calculating the aggregated turnover for passively-held assets. Any entities that are connected or affiliated with you will be taken to be connected or affiliated with the small business entity.

    There is a special affiliate rule for spouses and children under 18 that applies for passively-held assets in working out whether entities are connected or affiliated with each other.

    Partners and passively-held assets

    In addition to the above conditions, if you are carrying on a business in partnership, you may also meet the basic condition for passively-held assets if you are connected with the partnership and:

    • the partnership has aggregated turnover less than $2 million
    • you do not carry on any other business other than as a partner in a partnership business
    • the asset is your asset – that is, it is not your interest in a partnership asset
    • the asset is used in the business you carry on in that partnership.

    There is a special affiliate rule for spouses and children under 18 that applies for passively-held assets in working out whether entities are connected or affiliated with each other.

    There is a special rule for calculating aggregated turnover for passively-held assets. Any entities that are connected or affiliated with you will be taken to be connected or affiliated with the small business entity.

      Last modified: 21 Jun 2016QC 19744