ATO Interpretative Decision
ATO ID 2001/306
Income Tax
Capital Gains: Extension of time to acquire replacement assets for CGT small business roll-overFOI status: may be released
This version is no longer current. Please follow this link to view the current version. |
-
This document incorporates revisions made since original publication. View its history and amending notices, if applicable.
This ATOID provides you with the following level of protection:
If you reasonably apply this decision in good faith to your own circumstances (which are not materially different from those described in the decision), and the decision is later found to be incorrect you will not be liable to pay any penalty or interest. However, you will be required to pay any underpaid tax (or repay any over-claimed credit, grant or benefit), provided the time limits under the law allow it. If you do intend to apply this decision to your own circumstances, you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed. You may wish to obtain further advice from the Tax Office or from a professional adviser.
Issue
Whether the Commissioner can extend the period of two years set out in subsection 123-75(1) of the Income Tax Assessment Act 1997 (ITAA 1997) within which a taxpayer must acquire a replacement asset to obtain small business roll-over.
Decision
No. The Commissioner has no discretion to extend the period of two years set out in subsection 123-75(1) of the ITAA 1997 within which the taxpayer must acquire a replacement asset to obtain small business roll-over.
Facts
The taxpayer sold the assets of the business in the 1998-1999 income year and received an amount for goodwill.
The taxpayer wants to roll over the capital gain from goodwill. However, more than 2 years have elapsed since the taxpayer entered into the contract to dispose of the business assets.
The taxpayer has requested an extension of time to acquire a replacement asset under the capital gains tax small business roll-over provisions as they applied at that time.
Reasons for Decision
Former Division 123 of the ITAA 1997 provides for a roll-over of a capital gain, and is applicable to assessments for the 1998-1999 income year.
A taxpayer who meets the conditions in section 123-10 of the ITAA 1997 can choose the roll-over. Under paragraph 123-10(f) of the ITAA 1997 the taxpayer can choose a roll-over where, not later than 2 years after the last trigger event during the roll-over year, the taxpayer chooses one or more CGT assets as replacements.
Under subsection 123-75(1) of the ITAA 1997 the taxpayer must acquire the replacement asset within the period starting one year before and ending two years after the happening of the last CGT event in the relevant income year.
The Commissioner does not have any discretion to grant an extension beyond the two year period specified in subsection 123-75(1) of the ITAA 1997.
Date of decision: 10 May 2001
Legislative References:
Income Tax Assessment Act 1997
Division 123
section 123-10
paragraph 123-10(f)
subsection 123-75(1)
Keywords
CGT replacement assets
CGT rollover relief
ISSN: 1445-2782
| Date: | Version: | |
| You are here | 10 May 2001 | Original statement |
| 23 April 2010 | Archived |
Copyright notice
© Australian Taxation Office for the Commonwealth of Australia
You are free to copy, adapt, modify, transmit and distribute material on this website as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).
