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Edited version of private advice
Authorisation Number: 1051870339851
Date of advice: 29 July 2021
Ruling
Subject:Income Tax - CGT - Small business rollover
Question
Will the Commissioner exercise his discretion under subsection 104-190(2) of the Income Tax Assessment Act 1997 (ITAA 1997) to extend the replacement asset period in respect of the small business capital gains tax (CGT) replacement asset roll-over?
Answer
Yes. Having considered your full circumstances, the Commissioner considers it would be fair and equitable for the purposes of section 104-190(2) of the ITAA 1997 to extend the replacement asset period from XXXX to XXXX and allow the small business roll-over under Subdivision 152-E of the ITAA 1997.
This ruling applies for the following periods:
Year Ending 30 June 20XX
Year Ending 30 June 20XX
Year Ending 30 June 20XX
The scheme commences on:
XX XXXX 20XX
Relevant facts and circumstances
You entered into a contract on XXXX to sell two of your properties.
On XXXX you were paid a deposit of $XXX by the purchaser. An instalment of $XXX was to be paid to you on XXXX. The purchaser failed to pay the instalment of $XXX and terminated the contract. As per the terms of the contract you were entitled to keep the deposit of $XXX.
Pre-empting that the sale of your properties would go through you purchased X replacement properties.
You entered into contracts to purchase replacement properties on the basis that the sale of your X properties would settle and you intended on utilising the small business rollover relief.
You calculated your capital gain for the forfeiture of the deposit to be $XXX before the application of the small business CGT concessions.
You satisfy the basic conditions in Subdivision 152-A of the ITAA 1997.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 104-185
Income Tax Assessment Act 1997 section 104-190