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Edited version of private advice
Authorisation Number: 1051799982390
Date of advice: 1 February 2021
Ruling
Subject: Capital gains tax - extension of time to make a choice
Question
Will the Commissioner exercise discretion under section 103-25(1)(b) of the Income Tax Assessment Act 1997 (ITAA 1997) to allow you, an extension of time to XX March 20XX to make a choice to apply the small business 50% reduction, the small business retirement exemption, and the small business rollover, as contained in Division 152 of the ITAA 1997?
Answer
There would be no prejudice to the ATO by allowing the extension. There is no mischief involved. The Commissioner considers it fair and equitable in these circumstances for an extension to be allowed. The Commissioner has granted until XXX to make a valid choice to apply the small business CGT concessions.
This ruling applies for the following periods:
Year ending 30 June 20XX
Year ending 30 June 20XX
Year ending 30 June 20XX
Year ended 30 June 20XX
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
The Taxpayers sold a property in the XX calendar year.
A capital gain from a CGT Event A1 was made on the disposal of the property.
It come to the attention of the Taxpayers' new tax agent that the capital gain was not included in the Taxpayers 20XX income tax returns. A choice to apply the small business CGT concessions has not been made.
The Property was an active asset and the Taxpayers were eligible to apply the small business concessions to the capital gain made from the disposal of the property.
The Taxpayers have made a voluntary disclosure to the Commissioner in relation to the failure to include the capital gain - even though no amended assessment has been issued by the Commissioner.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 103-25(1)(b)
Income Tax Assessment Act 1997 Division 152-C
Income Tax Assessment Act 1997 Division 152-D
Income Tax Assessment Act 1997 Division 152-E