Income Tax Assessment Act 1997
CHAPTER 3
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SPECIALIST LIABILITY RULES
PART 3-3
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CAPITAL GAINS AND LOSSES: SPECIAL TOPICS
Division 122
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Roll-over for the disposal of assets to, or the creation of assets in, a wholly-owned company
Subdivision 122-A
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Disposal or creation of assets by an individual or trustee to a wholly-owned company
When is a roll-over available
SECTION 122-25 Other requirements to be satisfied 122-25(1)
You must own all the *shares in the company just after the time of the trigger event.
122-25(2)
This Subdivision does not apply to the *disposal or creation of any of the assets specified in this table:
122-25(3)
A precluded asset is:
(a) a *depreciating asset; or
(b) *trading stock; or
(c) an interest in the copyright in a *film referred to in section 118-30 ; or
(d) a *registered emissions unit.
122-25(4)
If:
(a) the *CGT asset or any of the assets of the *business is a right, option, *convertible interest or *exchangeable interest; and
(b) the company *acquires another CGT asset by exercising the right or option or by converting the convertible interest or in exchange for the disposal or redemption of the exchangeable interest;
122-25(5)
The *ordinary income and *statutory income of the company must not be exempt from income tax because it is an *exempt entity for the income year of the trigger event.
122-25(6)
If you are an individual at the time of the trigger event, either:
(a) you and the company must both be Australian residents at that time; or
(b) both of the following requirements must be satisfied:
122-25(7)
If you are a trustee of a trust at the time of the trigger event, either:
(a) at that time, the trust must be a *resident trust for CGT purposes and the company must be an Australian resident; or
(b) both of the following requirements must be satisfied:
View history note
Hide history noteSECTION 122-25 Other requirements to be satisfied 122-25(1)
You must own all the *shares in the company just after the time of the trigger event.
Note:
You must own the shares in the same capacity as you owned or created the assets that the company now owns.
122-25(2)
This Subdivision does not apply to the *disposal or creation of any of the assets specified in this table:
| Assets to which Subdivision does not apply | |||
| Item | In this situation: | This Subdivision does not apply to: | |
| 1 | You *dispose of a *CGT asset to the company or create a CGT asset in the company | (a) | a *collectable or a *personal use asset; or |
| (b) | a decoration awarded for valour or brave conduct (except if you paid money or gave any other property for it); or | ||
| (c) | a *precluded asset; or | ||
| (d) | an asset that becomes *trading stock of the company just after the *disposal or creation; or | ||
| (e) | an asset that becomes a *registered emissions unit *held by the company just after the *disposal or creation | ||
| . | |||
| 2 | You *dispose of all the assets of a *business to the company | (a) | a *collectable or a *personal use asset; or |
| (b) | a decoration awarded for valour or brave conduct (except if you paid money or gave any other property for it); or | ||
| (c) | an asset that becomes *trading stock of the company just after the disposal or creation (unless it was your trading stock when you disposed of it); or | ||
| (d) | an asset that becomes a *registered emissions unit *held by the company just after the *disposal or creation (unless it was a registered emissions unit held by you when you disposed of it) |
122-25(3)
A precluded asset is:
(a) a *depreciating asset; or
(b) *trading stock; or
(c) an interest in the copyright in a *film referred to in section 118-30 ; or
(d) a *registered emissions unit.
122-25(4)
If:
(a) the *CGT asset or any of the assets of the *business is a right, option, *convertible interest or *exchangeable interest; and
(b) the company *acquires another CGT asset by exercising the right or option or by converting the convertible interest or in exchange for the disposal or redemption of the exchangeable interest;
the other asset cannot become *trading stock of the company just after the company acquired it.
122-25(5)
The *ordinary income and *statutory income of the company must not be exempt from income tax because it is an *exempt entity for the income year of the trigger event.
122-25(6)
If you are an individual at the time of the trigger event, either:
(a) you and the company must both be Australian residents at that time; or
(b) both of the following requirements must be satisfied:
(i) each asset must be *taxable Australian property at that time;
(ii) the shares in the company mentioned in subsection 122-20(1) must be taxable Australian property just after that time.
122-25(7)
If you are a trustee of a trust at the time of the trigger event, either:
(a) at that time, the trust must be a *resident trust for CGT purposes and the company must be an Australian resident; or
(b) both of the following requirements must be satisfied:
(i) each *CGT asset must be a CGT asset of the trust that is *taxable Australian property at that time; and
(ii) the shares in the company mentioned in subsection 122-20(1) must be taxable Australian property just after that time.
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