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Edited version of private advice
Authorisation Number: 1051630403750
Date of advice: 30 January 2020
Ruling
Subject: CGT - small business concessions - deceased estate - EOT
Question
Will the Commissioner, pursuant to subsection 152-80(3) of the Income Tax Assessment Act 1997 (ITAA 1997), allow an extension of time to XX June 20XX to allow the small business capital gains tax (CGT) concessions to be applied?
Answer
Yes. Having considered your circumstances and the relevant factors, the Commissioner will allow an extension of time. Further information on death and the small business CGT concessions can be found on our website, ato.gov.au by searching Quick Code QC52292.
This ruling applies for the following periods:
Year ending 30 June 2019
Year ending 30 June 2020
Year ending 30 June 2021
The scheme commences on:
1 July 2018
Relevant facts and circumstances
The decease died on XX XX 20XX.
The deceased and B and C were co-owners of three properties (the properties), which were used in their partnership business.
Each partner held a one third interest in both the properties and the partnership.
The properties consist of the following:
· D Road (X lots)
· E Road (X lots)
· F Road (X lots)
The deceased inherited their interest in the properties upon the death of their spouse after 20 September 1985.
The deceased's spouse had been operating a business on the properties in partnership with B and C prior to their death.
The deceased, B and C commenced the partnership in 19XX.
If the deceased had disposed of the properties just prior to their death, they would have been eligible to apply the small business CGT concessions.
The deceased's interest in the property was transferred to the executor of their estate.
The trading stock used in the partnership business held by the deceased, passed to the deceased's family member under their will.
After the deceased's death, a new partnership was established between B, C and the deceased's family member in order to continue the business, sell the trading stock and commence the process of winding down the business and disposing of the assets, including the properties.
The properties were placed on the market for sale, however due to market conditions it has been challenging to find buyers for the properties, causing the delay in their disposal. X lots have been sold, however the remaining X lots are still on the market for sale.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 152-80