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INCOME TAX ASSESSMENT ACT 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-1 - CAPITAL GAINS AND LOSSES: GENERAL TOPICS  

Division 104 - CGT events  

Subdivision 104-J - CGT events relating to roll-overs    View history reference

SECTION 104-198  Cost of acquisition of replacement asset or amount of fourth element expenditure, or both, not sufficient to cover disregarded capital gain: CGT event J6  

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104-198(1)  

CGT event J6 happens if you choose a small business roll-over under Subdivision 152-E for a *CGT event that happens in relation to a *CGT asset in an income year and:


(a) by the end of the *replacement asset period, you have done either or both of the following:

(i) *acquired a replacement asset (the replacement asset);

(ii) incurred *fourth element expenditure in relation to a CGT asset (also the replacement asset); and
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(b) at the end of the replacement asset period, the replacement asset is your *active asset; and


(c) if the replacement asset is a *share in a company or an interest in a trust, at the end of the replacement asset period:


(i) you, or an entity *connected with you, are a *CGT concession stakeholder in the company or trust; or

(ii) CGT concession stakeholders in the company or trust have a *small business participation percentage in you of at least 90%; and


(d) the total (the amount incurred) of the following, in relation to each replacement asset that satisfied paragraph (b) and, if applicable, paragraph (c), is less than the amount of the capital gain that you disregarded:


(i) the first element of the *cost base;

(ii) the *incidental costs you incurred (which can include giving property, see section 103-5);

(iii) the amount of fourth element expenditure incurred.

Note:

You do not have to satisfy the basic conditions in Subdivision 152-A for the gain in relation to CGT event J6 (see subsection 152-305(4)).

104-198(2)  

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The time of the event is at the end of the *replacement asset period.

104-198(3)  

You make a capital gain equal to the difference between:


(a) the amount of the *capital gain that you disregarded under Subdivision 152-E; and


(b) the amount incurred.

104-198(4)  

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The *replacement asset period may be modified or extended as mentioned in section 104-190.


 



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