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Edited version of private advice
Authorisation Number: 1051724805708
Date of advice: 27 July 2020
Ruling
Subject: Commissioner's discretion - extension to the rollover period
Question
Will the Commissioner exercise his discretion to extend the replacement asset periodpursuant to subsection 104-190(2) of the Income Tax Assessment Act 1997 (ITAA 1997) in respect of the small business capital gains tax (CGT) replacement asset roll-over relief?
Answer
Yes. Having considered your circumstances and the relevant factors, the Commissioner considers it appropriate to grant an extension of the replacement asset period. Commissioner will exercise his discretion under subsection 104-190(2) of the ITAA 1997 to extend the time period.
This ruling applies for the following periods:
Years ending 30 June 20XX to 30 June 20XX
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
Two Individuals sold a capital gains tax asset under a contract.
The capital gain derived on the CGT event that occurred was eligible for the small business CGT concessions under Division 152 of ITAA 1997. Specifically, the small business rollover in subdivision 152-E was applied.
The replacement asset period has passed.
An eligible replacement asset had been identified with the intention of it to be purchased prior to the end date.
A solicitor had been instructed to commence preparing documentation to execute the acquisition.
One of the individuals died after an accident.
Currently the taxpayer is unable to move forward with the acquisition of the nominated replacement asset given the significant time and emotional pressure of the loss.
An extension of 12 months is requested to acquire a replacement asset.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 104-190(2)
Income Tax Assessment Act 1997 section 104-197
Income Tax Assessment Act 1997 subdivision 152-E