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Edited version of private advice
Authorisation Number: 1051889354002
Date of advice: 24 August 2021
Ruling
Subject: Rollover relief
Question
Is Unit Trust and all of its unit holders able to claim the rollover relief under Subdivision 124-N in respect of the restructure?
Answer
Yes. Based on the information provided, all of the requirements in Subdivision 124-N will be satisfied. Therefore, the Unit Trust and all of its unit holders are eligible to claim the rollover relief in relation to the restructure.
This ruling applies for the following period:
Year ending 30 June 20XX
The scheme commences on:
30 June 20XX
Relevant facts and circumstances
Trust A was established on XX XXX 20XX and is governed by the terms of the trust deed.
The sole unit holder of Trust A is Trust B.
There have been no distributions of non-assessable amounts that would be subject to CGT event E4 as the accounting distributions have been equal to the taxable income of Trust A.
A restructure of Trust A will be undertaken by converting the trust structure into a corporate structure.
A newly incorporated company (NewCo) will be incorporated as part of the restructure.
The restructure will commence in or around late August 20XX where all of its assets will be transferred to NewCo and some of the liabilities will be refinanced into NewCo. Trust A will be terminated within 6 months from this date.
The restructure period will commence in or around late August 20XX and will end in or around late February 20XX.
Trust A and NewCo will both choose to obtain rollover relief under Subdivision 124-N.
Trust B will choose to obtain rollover relief in relation to the ending of their units in Trust A under Subdivision 124-N.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 104-70
Income Tax Assessment Act 1997 Subparagraph 124-780(1)(a)(i)
Income Tax Assessment Act 1997 Section 124-N