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Edited version of private advice
Authorisation Number: 1051616556867
Date of advice: 4 December 2019
Ruling
Subject: Small business capital gains tax (CGT) concessions
Question
Will the Commissioner allow further time under paragraph 103-25(1)(b) of the Income Tax Assessment Act 1997 (ITAA 1997) for you to make a choice to utilise the small business capital gains tax (CGT) concessions?
Answer
Yes. The Commissioner will allow further time.
It is accepted that you did not make a valid choice at the time you lodged your income tax return. Having considered your situation, it is reasonable to grant an extension of time to make a choice to utilise the small business CGT concessions.
This ruling applies for the following period:
Year ended 30 June 20XX
Year ending 30 June 20XX
Year ending 30 June 20XX
The scheme commences on:
11 May 20XX
Relevant facts and circumstances
You purchased the farming property some years ago.
You sold the farming property recently.
The farming property was an active asset used in the primary production business carried on by Entity A. Entity A is a connected entity.
You purchased another property recently as a replacement asset. The new property was intended to be the replacement asset for your previous property and was purchased within the replacement asset period and is used in Entity A's business.
You made a capital gain from the sale. The capital gain was not included in your income tax return.
Your income tax return was completed without applying the small business 50% active asset reduction and small business rollover.
At the time of lodging your income tax return, you and your tax agent did not consider the application of the small business CGT concessions.
You subsequently received advice from a new tax agent and became aware concessions may be available in relation to the capital gain you made on the sale of the farming property.
Relevant legislative provisions
Income Tax Assessment Act 1997 Subsection 103-25(1)
Income Tax Assessment Act 1997 Division 152