Draft Taxation Determination

TD 93/D78

Income tax: capital gains: what are the CGT implications of removing a post-CGT building from post-CGT land and relocating it on pre-CGT land?

  • Please note that the PDF version is the authorised version of this draft ruling.
    This document has been finalised by TD 93/183.

FOI status:

draft only - for comment

Preamble

Draft Taxation Determinations (TDs) present the preliminary, though considered, views of the ATO. Draft TDs may not be relied on; only final TDs are authoritative statements of the ATO.

1. The removal of the building is not a disposal of an asset and on removal, the building and land are split into separate assets (see TD 93/D75).

2. The cost base of the post-CGT building and land is apportioned under subsection 160ZH(12) of the Income Tax Assessment Act 1936.

3. On relocation of the building to the pre-CGT land, the building continues to be a separate post-CGT asset (see TD 93/D77).

4. Any capital improvements made to the pre-CGT land will be a separate asset provided the requirements in subsection 160P(6) are satisfied.

5. The pre-CGT land remains a pre-CGT asset. Upon disposal of the land and building, a capital gain or capital loss may only arise in respect of the building (and capital improvements if they are treated as a separate asset).

Commissioner of Taxation
1 April 1993

References


BO TD/92/0029/PAR (CGTDET 61)

ISSN 1038 - 8982

Related Rulings/Determinations:

TD 6
TD 93/D75
TD 93/D76
TD 93/D77
TD 93/D79

Subject References:
Building relocation
capital improvements
composite asset
cost base
disposal of an asset
separate asset

Legislative References:
ITAA 160P(4)
ITAA 160P(6)
ITAA 160ZH(12)

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