Edited version of private advice

Authorisation Number: 1052052146055

Date of advice: 31 October 2022

Ruling

Subject: CGT - disposal of asset

Question 1

Do you have a Capital Gains Tax (CGT) event in the income year ended 30 June 20XX that requires reporting in your income tax return in the 20XX income year?

Answer

Yes.

Based on the information provided to the Commissioner, the disposal of the assets gives rise to a CGT event A1.

You are taken to have disposed of the assets in accordance with Section 104-102 of the Income Tax Assessment Act 1997 (ITAA 1997) by gifting one XXX to your family member and selling the remaining XXXs.

Any capital gain or loss must be included in your 20XX income tax return.

Question 2

For the purposes of the discount capital gain provisions (Division 115 of ITAA 1997), are you taken to have acquired the assets when XXX acquired them?

Answer

Yes.

You are taken to have acquired the assets when XXX acquired them in accordance with subsection 115-30(1) item 4 of the ITAA 1997.

Question 3

Is the cost base of the assets their cost base on the day XXX died?

Answer

Yes.

The cost base of the assets is the market value of the coins on XXXX in accordance with items 1 and 3A of subsection 128-15 (4) of the ITAA 1997.

You inherit the cost base for the assets from XXX on the date they died.

This ruling applies for the following period:

Year ended 30 June 20XX

The scheme commences on:

1 July 20XX

Relevant facts and circumstances

You are a resident of Australia for taxation purposes.

You inherited assets from your late spouse upon their death, as the beneficiary of their estate. The assets were never brought to Australia by your spouse.

In addition, your spouse was an Australian tax resident who inherited the assets on 20 XXX 20XX from their parent upon their passing. Their parent was not a tax resident of Australia.

The assets were a family heirloom that had been passed down for over XX years. The assets were not inherited by you in the course of any business or profit-making activity.

You did not actively monitor the value of the assets and they were simply stored away in a rented safe deposit box in a bank located overseas since you inherited them.

You disposed of all the assets during the year ended 30 June 20XX to multiple parties.

The sale occurred as the bank where the assets were located had indicated for some time that they were no longer prepared to permit an Australian citizen to rent a safe deposit box. As such, you believed it best to dispose of the assets to avoid any future potential issues that may arise.

The sale of assets was carried out on an arms-length basis to an overseas bank and an overseas buyer.

Relevant legislative provisions

Income Tax Assessment Act 1997 Section 104-102

Income Tax Assessment Act 1997 Subsection 128-15(4)

Income Tax Assessment Act 1997 Division 115