Taxation Determination

TD 93/180

Income tax: capital gains: how is the removal of a building from a block of land that does not amount to a loss or destruction, treated for CGT purposes ?

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This ruling contains references to repealed provisions, some of which may have been rewritten. The ruling still has effect. Paragraph 32 in TR 2006/10 provides further guidance on the status and binding effect of public rulings where the law has been repealed or repealed and rewritten. The legislative references at the end of the ruling indicate the repealed provisions and, where applicable, the rewritten provisions.

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FOI status:

may be releasedFOI number: I 1216114

This Determination, to the extent that it is capable of being a 'public ruling' in terms of Part IVAAA of the Taxation Administration Act 1953 , is a public ruling for the purposes of that Part. Taxation Ruling TR 92/1 explains when a Determination is a public ruling and how it is binding on the Commissioner. Unless otherwise stated, this Determination applies to years commencing both before and after its date of issue. However, this Determination does not apply to taxpayers to the extent that it conflicts with the terms of a settlement of a dispute agreed to before the date of issue of the Determination (see paragraphs 21 and 22 of Taxation Ruling TR 92/20).

1. The removal of a building from a block of land is not a disposal of any asset because, at that time, there is no change in ownership of either the land or the building. Rather, the original asset has been split into two separate assets (the land and the building).

2. In the event of a subsequent separate disposal of the land and building, the respective cost bases are determined in accordance with subsection 160ZH(12) of the Income Tax Assessment Act 1936. That is, where the original asset was acquired post-CGT, its cost base immediately before the removal is apportioned between the split assets.

Example:

Land with a building attached is purchased in 1987. In 1992, the building is relocated to another site.

For CGT purposes, there is no disposal arising from the removal of the building.

The cost base of the original asset is apportioned between the land and the building.

Commissioner of Taxation
9/9/93

Previously issued as Draft TD 93/D75

References

ATO references:
NO TD/92/0026/PAR (CGTDET 58)

ISSN 1038 - 3158

Related Rulings/Determinations:

TD 7;
TD 93/79 ;
TD 93/181;
TD 93/182;
TD 93/183;
TD 93/184

Subject References:
Apportionment;
disposal of an asset;
removal of a building from land;
split assets

Legislative References:
ITAA 160ZH(12)

TD 93/180 history

	Date:	Version:	Change:
	9 September 1993	Original ruling
You are here	29 November 2006	Original ruling + note	Repeal provision note
	21 April 2010	Consolidated ruling	Addendum

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