The small business CGT concessions allow qualifying small businesses the ability to fully disregard or reduce capital gains made by a small business. The rules apply to both business assets and ownership interests in a business entity (such as company shares).
The four CGT concessions available are:
Where a taxpayer who is at least 55 years of age and is retiring disposes of a CGT asset that has been owned for a minimum of 15 years.
The capital gain arising from the disposal of a qualifying (active) CGT asset may be discounted by 50%.
An exemption from CGT may apply for a disposal of a qualifying business (active) asset under the retirement exemption up to a lifetime maximum cap of $500,000. It is not necessary to actually retire and the concession can be utilised more than once up to the cap. Where the taxpayer is under 55 years, the proceeds are only exempt if this is rolled over into a complying superannuation fund, approved deposit fund or retirement savings account.
A capital gain arising from the disposal of a CGT asset may be deferred provided a replacement asset is acquired within a two year period. The gain is deferred until disposal of the replacement asset.
The small business CGT concessions can be complex and contain numerous requirements under each concession. Please contact Infinity Group on 9792 2772 for more information.
Established in 1999, Infinity Group is a multi-service firm that specialise in the areas of Finance, Property, Accounting & Taxation, Insurance and Migration Services.