Small Business CGT Concessions – Introduction

Size does matter.

At least it does when it comes to the Small Business CGT Concessions. These concessions, contained in Division 152 of the 1997 Act, can be extremely generous for those businesses who meet the requirements. They can;

In the case of the 15 year exemption – cause the capital gain to be reduced to nil, i.e. completely disregarded

In the case of the small business 50% reduction – reduce the gain by 50% (on top of the 50% general CGT discount, if applicable)

In the case of the retirement exemption – allow up to $500,000 of the gain to be disregarded and

In the case of the roll-over – defer all or part of the gain.

Furthermore, these concessions can be used in conjunction with each other. That is, they can be cumulative.

There is therefore a great benefit to access these concessions, if you can. Unfortunately the rules are complex and can be overwhelming, even to professional accountants. It doesn’t help that there were changes to the rules in 2006, 2007, 2009 and 2011 (the joys of being a tax accountant!). I hope to show that if you go through the requirements slowly and methodically, they aren’t so difficult.

The purpose of this series of articles (this is far too big a topic to cover in just one or two posts) is to explain how your business (or your client’s business) can qualify for the concessions and what it is you get if you do qualify. I hope you read and enjoy them and ask any questions that you have.

Cheers,

Simon

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