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Edited version of private advice
Authorisation Number: 1051908343212
Date of advice: 9 October 2021
Ruling
Subject: Small business concessions - active asset
Question 1
Does the property qualify as an 'active asset' within the meaning of that term in section 152-40 of the Income Tax Assessment Act 1997 (ITAA 1997)?
Answer
Yes. Although a small percentage of the property is used for the purpose of deriving rental income, the majority of the income earned from the property was from your business activities and therefore during the period of XX July XXXX to XX June XXXX, the property would continue to be considered an active asset.
Further information on active assets can be found by searching 'QC 52272' on ato.gov.au.
This ruling applies for the following period periods:
Income year ended 30 June 20XX
The scheme commences on:
1 July 2022
Relevant facts and circumstances
The company operates a business which has been in operation for over XX years. The company owns property (land and a shed) which is partly rented out to third parties. The land and shed has been owned for over XX years.
The company uses XX% of the shed and XX% of the outside land for his business, with XX% of the shed rented out to a third party. Over the past few years rent from the shed has averaged XXX per year and income from the business has averaged a lot more per year.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 152-40