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Edited version of private advice
Authorisation Number: 1051580479193
Date of advice: 12 September 2019
Ruling
Subject: Capital gains tax
Question
Will the Commissioner allow further time as provided in paragraph 103-25(1)(b) of the Income Tax Assessment Act 1997 (ITAA 1997) for you to choose to apply the small business rollover to a capital gain that arose in the 20XX financial year?
Answer
Yes, an extension will be granted to 20XX.
Having considered your circumstances and the relevant factors, the Commissioner is able to apply his discretion under subsection 103-25(1) of the ITAA 1997 and allow an extension of time. You can find further information on CGT concessions by searching QC 22655 on our website ato.gov.au.
This ruling applies for the following period:
Year ended 30 June 2017
The scheme commences on:
1 July 2016
You triggered a capital gain when you sold your property in 20XX.
This property was an active asset as it was used in the course of carrying on your business as a small business entity for capital gains.
At the time of the CGT event, you satisfied the conditions to access the small business concessions in Division 152 of the ITAA 1997.
You lodged your income tax return for the year 20XX through a tax professional and did not make an election to choose the small business rollover in the relevant year the CGT event happened. Your tax return shows you made a capital gain for that year, but you did not make an election to choose the small business rollover. You were not advised or aware by the tax professional that at the time the small business rollover relief may have been available to you, upon disposal.
Post the sale of your property you purchased a new property that is being used in the course of carrying on your business.
You have engaged the services of a new tax agent and in preparing your tax return for year ended 20XX; it is at this time that you have been advised and made aware that the small business rollover relief is available to you. You are seeking to amend your tax return for the year ended 20XX.
You still meet the small business 50% active asset reduction, as the new property is being used in the course of running your business.
You intend to make a choice to apply the active asset reduction and the small business rollover relief when you lodge an amendment to your tax return for the 20XX financial year.
You will lodge the amendment by 20XX.
Relevant legislative provisions
Income Tax Assessment Act 1997 Subsection 103-25(1)