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Edited version of private advice
Authorisation Number: 1051845756599
Date of advice: 29 May 2021
Ruling
Subject: Small business concessions - extension of time - replacement asset
Question
Will the Commissioner exercise his discretion under subsection 104-190(2) and 104-197(5) of the Income Tax Assessment Act 1997 (ITAA 1997) to extend the replacement asset period to 30 April 20XX?
Answer
Yes. Having regard to the particular circumstances of your case and the information provided, the Commissioner has applied the discretion and will extend the replacement asset period to 30 April 20XX.
This ruling applies for the following periods:
Year ending 30 June 20XX
Year ending 30 June 20XX
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
The Trust disposed of a CGT asset.
The Trust utilised the Small Business Rollover under subdivision 152-E of the ITAA 1997 and chose to rollover part of the proceeds.
The sale contract stipulated a long settlement date which was subsequently delayed at the buyer's request.
The Trust was not in a position to acquire a replacement asset until settlement had finalised due to the capital proceeds not being received, and also due to the uncertainty of settlement taking place during the COVID pandemic.
The Trust has been actively searching for an alternatively business premises from which to conduct the business carried on by a connected entity. The COVID pandemic has made searching for and find a suitable replacement asset difficult.
The Trust made an offer on a suitable replacement asset but it was not accepted by the vendor.
Relevant legislative provisions
Income Tax Assessment Act 1997 Subdivision 152-E
Income Tax Assessment Act 1997 section 104-190
Income Tax Assessment Act 1997 section 104-197