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Edited version of private advice
Authorisation Number: 1051751325551
Date of advice: 9 September 2020
Ruling
Subject: Small business concessions
Question
Do you meet the basic conditions for small business concessions in accordance with section 152-10 of the Income Tax Assessment Act 1997 (ITAA 1997)?
Answer
Yes. The Commissioner accepts that you meet the basic conditions to make use of the small business replacement asset rollover as per subdivision 152-E of the ITAA 1997. For more information please see QC 52291 on ato.gov.au.
Please note that the Commissioner has not determined your eligibility to use the small business 15-year exemption or 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 operated a primary production business of cattle grazing and hay production with your spouse in a family partnership on property 1.
Your purchased property 1 after leasing it for the previous XXX years.
Property 1 has been used in the partnerships primary production business for a number of years.
The income for the partnership is less than $XXX dollars per year.
You have lodged partnership income tax returns with the Australian Taxation Office (ATO) declaring the income from your primary production activities.
Property 1 was sold creating a capital gain.
Your share of the sale proceeds is XX% and your spouse's share is the remaining XX%.
You and your spouse have had a marriage breakdown.
You and your spouse entered into a Binding Financial Agreement (BFA) in accordance with section 90C of the Family Law Act 1975.
You and your spouse also own property 2 as joint tenants.
The BFA advises that the ownership title of property 2 will be transferred to you as the sole owner after transferring your spouse an amount of $XXX.
You will commence your own primary production business of cattle grazing and hay production on property 2.
Property 2 will also be your main residence.
Property 1 has been used in the partnerships primary production business for at least half of the active asset test period.
Relevant legislative provisions
Income Tax Assessment Act 1997 section100-45
Income Tax Assessment Act 1997 section 152-10
Income Tax Assessment Act 1997 section 152-35
Income Tax Assessment Act 1997 subdivision 152-E