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Edited version of your private ruling
Authorisation Number: 1012470165001
Ruling
Subject: Extension of time request
Question
Will the Commissioner exercise his discretion under paragraph 124-75(3)(b) of the Income Tax Assessment Act 1997 to allow an extension of time?
Answer
Yes.
This ruling applies for the following period:
Year ended 30 June 2012
The scheme commences on:
1 July 2011
Relevant facts and circumstances
You owned a large parcel of land.
The land was compulsorily acquired.
Following the compulsory acquisition, you were continuously looking for an appropriate replacement property.
You were engaged in a protracted legal dispute regarding the quantum of the compensation.
You did not receive any compensation in relation to the acquisition until after 30
June 2011.
You are still involved in a dispute in relation to the amount of compensation paid and the associated disturbance costs.
You have requested an extension under paragraph 124-75(3)(b) of the ITAA.
Relevant legislative provisions
Income Tax Assessment Act 1997 Subdivision 124-B
Income Tax Assessment Act 1997 section 124-75(3)(b)
Reasons for decision
Subdivision 124-B of the Income Tax Assessment Act 1997 (ITAA 1997) explains the circumstances when a rollover is available for an asset that is compulsorily acquired, lost or destroyed.
If you receive money as a result of the compulsory acquisition, you can only choose a rollover if you incur expenditure in acquiring another CGT asset. Under subsection 124-75(3), you must incur at least some of the expenditure no earlier than one year before the event happens or, within one year after the end of the income year in which the event happens.
This period may be extended in special circumstances as outlined in the following example in Taxation Determination TD 2000/40:
Graeme had a commercial property compulsorily acquired by a State authority. Graeme is having a protracted legal dispute with the authority over the quantum of the compensation. On these facts, we would accept that there are special circumstances to allow further time.
Having regards to your full circumstances and the above principles, the Commissioner will allow an extension of time.