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Edited version of private advice
Authorisation Number: 1051892613365
Date of advice: 7 September 2021
Ruling
Subject: Small business concession - extension of time
Question
Will the Commissioner Discretion be exercised under subsection 152-125(4) of the Income Tax Assessment Act 1997 to allow a further extension of time for the payment of the exempt amount out to a capital gains tax concession stakeholder until XX June 20XX?
Answer
Yes.
Under subsection 152-125(4) of the Income Tax Assessment Act 1997 (ITAA 1997) the Commissioner may extend the two year time limit. The Commissioner generally extends the time limit where the delay in receiving the capital proceeds is out of your control. Having considered the facts and circumstances of your application, the Commissioner will exercise discretion to apply a further extension of time for the payment of the exempt amount out to a capital gains tax concession stakeholder until 30 June 20XX.
This ruling applies for the following period:
Year ending 30 June 20XX
The scheme commences on:
XX July 20XX
Relevant facts and circumstances
The Company is eligible to apply the small business concessions to the sale of the Property. This was confirmed in a private ruling issued on XX XXXX XX.
On XX XXXX XX, the Commissioner previously exercised discretion to allow an extension of time to the Company.
The Company has been unable to make a payment to the CGT concession stakeholder because the Company is yet to receive the capital proceeds from the sale of the Property.
The Company commenced legal action against the purchaser and other parties in relation to the sale of the property and to recover an amount of $X, plus interest and costs.
A mediation between the parties occurred on XX XXX XX however this was unsuccessful.
The Honourable Justice XXXX has decided that the XXXX proceeding should be collaborated with a subsequent trial against XXXX, starting on XX XXXX XX. A determination will be decided after this date.
Relevant legislative provisions
Income Tax Assessment Act 1997 subparagraph 152-125(4)