The Small Business 15-Year Capital Gains Tax (CGT) Exemption is the most generous of the four small business capital gains tax concessions. If you qualify, you can disregard the entire capital gain from the sale of an active business asset. Please refer to Subdivision 152-B of the Income Tax Assessment Act 1997.
The Key Benefits:
- 100% CGT - Free Sale. The entire capital gain is exempt from tax, regardless of the amount.
- No Need to Offset Capital Losses. You don’t have to apply any capital losses before using this exemption - they remain available for future use. You can carry them forward.
- Increase your Superannuation Balance. You can contribute the proceeds to super without affecting your non-concessional cap.
- Tax Free Distributions from Companies or Trusts. If a company or trust claims the exemption, it can distribute the exempt amount tax - free to the CGT concession stakeholders.
- Priority Over Other CGT Concessions. This exemption must be applied first and if used, no other CGT concessions are needed for that gain.
To qualify, you must meet basic CGT conditions and:
- Aged 55 or older and retiring (or be permanently incapacitated).
- Have owned the asset continuously for at least 15 years.
- The asset must be an active asset used in your business.
- If the asset is held in a company or trust, it must have had a significant individual for at least 15 years.
McNamara & Company - Chartered Accountants, located minutes from the Melbourne CBD
www.mcnamaraandco.au/contact-us
Phone +61 3 9428 1062
Email admin@mcnamaraandco.au
Please refer to disclaimer at the bottom of the page
