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Edited version of private advice
Authorisation Number: 1051707624478
Date of advice: 2 July 2020
Ruling
Subject: CGT small business retirement exemption - extension of time
Question
Can you have an extension of time to XX/XX/XXXX to make a written choice to apply the small business retirement exemption?
Answer
Yes.
Generally, the way you prepare your income tax return is evidence of the making of a choice in relation to CGT. However, an exception is that a choice to apply the small business retirement exemption must be made in writing (paragraph 103-25(3)(b) of the Income Tax Assessment Act 1997). You have yet to make a choice in writing to apply the small business retirement exemption. A choice in relation to CGT must be made by the day you lodge the relevant income tax return or within a further time allowed by the Commissioner. Having regard to your circumstances it is considered appropriate to allow you an extension of time to XX/XX/XXXX to make a written choice to apply the small business retirement exemption.
This ruling applies for the following period:
Year ended 30 June 20XX
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
You are under 55 years of age.
You had a CGT event that resulted in a capital gain amount that was to be included in your 20XX-XX income tax return.
You and your tax agent contemplated applying the small business retirement exemption but were waiting until closer to the due date for lodgement for your 20XX-XX income tax return
(XX/XX/XXXX) to determine whether you had the capacity to make the contribution to your superannuation fund that was required in order to choose the exemption.
Your 20XX-XX income tax return was mistakenly lodged early on XX/XX/XXXX.
You have not made a written choice to apply the small business retirement exemption to the capital gain.
You will make a payment equal to the exempt amount into a complying superannuation fund when you make the choice to apply the retirement exemption.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 103-25
Income Tax Assessment Act 1997 section 152-305
Income Tax Assessment Act 1997 section 152-315