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This edited version has been archived due to the length of time since original publication. It should not be regarded as indicative of the ATO's current views. The law may have changed since original publication, and views in the edited version may also be affected by subsequent precedents and new approaches to the application of the law.

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Edited version of private advice

Authorisation Number: 1051531802040

Date of advice: 19 June 2019

Ruling

Subject: Capital gains tax - small business concessions - extension of time to make a choice

Question

Will the Commissioner allow further time under paragraph 103-25(1)(b) of the Income Tax Assessment Act 1997 (ITAA 1997) for you to choose to apply a small business concession under Division 152 of the ITAA 1997 to a capital gain that arose in the year ended 30 June 2017?

Answer

Yes.

Having considered your circumstances and the relevant factors the Commissioner considers it appropriate to grant an extension of time to make a choice under paragraph 103-25(1)(b). Further information can be found by searching 'QC 52288' on ato.gov.au

This ruling applies for the following periods:

Year ended 30 June 2017

Year ended 30 June 2018

Year ending 30 June 2019

Year ending 30 June 2020

The scheme commenced on:

1 July 2016

Relevant facts

You acquired a property (The property).

The property has been leased ('A') since acquisition.

The property is used in the business of ('A') which is also a connected entity of you.

'A' sold business assets to 'B' which is an unrelated entity in 20xx.

'A' also entered into a lease for the property to 'B' in 20xx for a period of time to ensure that there was a smooth transition of business ownership and client stability. The lease agreement ended 20xx.

Due to family health issues the managing director ('C') and shareholder of 'A' decided to sell the business and enter the lease agreement with 'B'.

'D' is the spouse of 'C' and is the significant individual of you.

The aggregated turnover was less than $2 million.

The net asset value of the trust, its affiliates and connected entities was less than $6 million.

The property was sold in 20xx.

You have a net capital gain as a result of the sale of the property and this has been included in your income tax return.

A distribution was made to 'C' and 'D'.

You have used the services of a tax agent for a number of years.

You have recently reviewed your income tax return and are now aware that you are eligible to access the small business concessions and would like to amend your income tax.

Relevant legislative provisions

Income Tax Assessment Act 1997 subsection 103-25(1)

Income Tax Assessment Act 1997 paragraph 103-25(1)(b)

Income Tax Assessment Act 1997 subsection 103-25(2)

Income Tax Assessment Act 1997 paragraph 103-25(3)(b)

Income Tax Assessment Act 1997 section 152-35

Income Tax Assessment Act 1997 section 152-205

Income Tax Assessment Act 1997 section 152-305

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