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Edited version of private advice
Authorisation Number: 1051810341484
Date of advice: 9 March 2021
Ruling
Subject: Extension of time to replace an asset to maintain the small business CGT concession
Question
Will the commissioner exercise his discretion under subsection 104-190(2) of the Income Tax Assessment Act 1997 (ITAA 1997) to extend the replacement asset period?
Answer
Yes. Having considered the relevant factors, and the circumstances of your case, the Commissioner will exercise his discretion to extend the replacement asset period?
This ruling applies for the following periods:
Year ending DD MM YYYY
The scheme commences on:
DD MM YYYY
Relevant facts and circumstances
You commenced a small business on a property you owned.
You sold the property.
On disposal of the property you made a net capital gain of $X to which you applied the small business rollover (after applying the 50% general discount and the small business active asset reduction).
You intended to acquire a replacement asset within the 2 year timeframe to avoid triggering CGT event J5.
Due to COVID-19 you experienced a delay in acquiring a replacement asset. The market had been severely affected and you were unable to travel due to border restrictions.
You intend to acquire a replacement asset by DD MM YYYY.
Relevant legislative provisions
Income Tax Assessment Act 1997 Subdivision 152-A
Income Tax Assessment Act 1997 Subdivision 152-E
Income Tax Assessment Act 1997 Subsection 104-185(1)
Income Tax Assessment Act 1997 Subsection 104-190(2)
Income Tax Assessment Act 1997 Section 104-197
Income Tax Assessment Act 1997 Section 104-198
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