Edited version of private advice

Authorisation Number: 1052076572199

Date of advice: 25 January 2023

Ruling

Subject: CGT - small business rollover

Question

Will the Commissioner exercise the discretion pursuant to subsection 104-190(2) of the Income Tax Assessment Act 1997 (ITAA 1997) to extend the small business capital gains tax (CGT) replacement asset period?

Answer

Yes. Having considered your circumstances and the relevant factors, the Commissioner will extend the replacement asset period.

This ruling applies for the following period:

Year ending 30 June 20XX

The scheme commences on:

1 July 20XX

Relevant facts and circumstances

You had a CGT even happen in the 20XX financial year which resulted in a capital gain. The capital gain was rolled over under the small business roll-over.

You were negotiating the purchase of your sibling's interest in a property which was inherited from your parent's estate (the Property).

The Property was considered an eligible replacement asset.

You and your sibling had not been able to agree on the administration of the estate and therefore, the negotiations to purchase your sibling's interest in the Property failed.

You searched for an alternative replacement asset. However, due to the COVID-19 restrictions, health issues and the limited suitable assets for sale in your district, you have not yet secured a replacement asset.

You resumed negotiations with your sibling and made an offer to purchase his interest in the Property. A meeting was organised with your solicitor and sibling to try and finalise the purchase. You were not able to attend the meeting because you were admitted to hospital.

You are rescheduling the meeting to take place within the next few weeks.

Relevant legislative provisions

Income Tax Assessment Act 1997 section 104-190