INCOME TAX ASSESSMENT ACT 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-3 - CAPITAL GAINS AND LOSSES: SPECIAL TOPICS  

Division 152 - Small business relief  

Subdivision 152-D - Small business retirement exemption  

SECTION 152-305   Choosing the exemption  

Individual

152-305(1)  
If you are an individual, you can choose to disregard all or part of a *capital gain if:


(a) the basic conditions in Subdivision 152-A are satisfied for the gain; and


(b) if you are under 55 just before you make the choice - you contribute an amount equal to the asset ' s *CGT exempt amount to a *complying superannuation fund or an *RSA; and

Note:

For the non-deductibility of the contribution, see subsection 290-150(4) .


(c) the contribution is made:


(i) if the relevant CGT event is CGT event J2, J5 or J6 - when you made the choice; or

(ii) otherwise - at the later of when you made the choice and when you received the proceeds.
Note 1:

Section 103-25 tells you when the choice must be made.

152-305(1A)  


If you receive the *capital proceeds from the *CGT event in instalments, paragraphs (1)(b) and (c) apply to each instalment in succession (up to the asset's *CGT exempt amount).

152-305(1B)  


For the purposes of (but without limiting) subsection (1A), you are treated as receiving the *capital proceeds in instalments if:


(a) the *CGT event happened because you *disposed of the *CGT asset; and


(b) the capital proceeds from the disposal are increased by one or more *financial benefits that you receive under a *look-through earnout right.

Company or trust

152-305(2)  
A company or a trust (except a public entity - see subsection (3)) can also choose to disregard such an amount if:


(a) the basic conditions in Subdivision 152-A are satisfied for the *capital gain; and


(b) the entity satisfies the significant individual test (see section 152-50 ); and


(c) the company or trust conditions in section 152-325 are satisfied.

Note:

Section 103-25 tells you when the choice must be made.

152-305(3)  


Entities of a kind referred to in subsection 328-125(8) cannot make the choice.

152-305(4)  


Paragraphs (1)(a) and (2)(a) do not apply if the *capital gain arose from *CGT event J5 or J6.

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