| Disclaimer You cannot rely on this record in your tax affairs. It is not binding and provides you with no protection (including from any underpaid tax, penalty or interest). In addition, this record is not an authority for the purposes of establishing a reasonably arguable position for you to apply to your own circumstances. For more information on the status of edited versions of private advice and reasons we publish them, see PS LA 2008/4. |
Edited version of private advice
Authorisation Number: 1052116982340
Date of advice: 10 May 2023
Ruling
Subject: Extension of time to replace a compulsorily acquired asset
Question
Will the Commissioner exercise the discretion available under paragraph 124-75(3)(b) of the Income Tax Assessment Act 1997 (ITAA 1997) to provide an extension of time for the Company to acquire a replacement asset?
Answer
Yes.
We accept that special circumstances have delayed the Company's attempts to acquire a replacement asset and will provide the extension of time.
This ruling applies for the following periods:
Financial year ending 30 June 20XX
Financial year ending 30 June 20XX
The scheme commenced on:
1 July 20XX
Relevant facts and circumstances
The Company owned the Property that was compulsorily acquired by an Australian government agency for an agreed market value.
The Company is currently seeking additional compensation.
The Company has actively sought to acquire a replacement property.
The Company has encountered significant difficulty locating and purchasing an equivalent property within the replacement asset period.
The Company representatives have attended a number of auctions, with those properties selling well in excess of the advertised price.
An equivalent property has not yet been identified from the market research undertaken, those of similar market value are vacant possession and do not offer a commensurate yield/rate of return to the compulsorily acquired property.
Upon finalising the claim for additional compensation, the Company should have additional funds to acquire a suitable replacement property.
Relevant legislative provisions
Income Tax Assessment Act 1997 subsection 124-70(1)
Income Tax Assessment Act 1997 subsection 124-75(3)
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).
