12 May 10 Consultation Paper - Improvements to the CGT law: certain business restructures
As notified in our special Budget edition of TAXVINE - 2010 TAXVINE No 19 (11 May 2010) - the Assistant Treasurer has announced that Government would introduce legislation to amend the CGT provisions to improve the ability of businesses to restructure, applying to CGT events happening after 7.30pm on 11 May 2010.
These amendments involve:
- Extending the existing roll-over for the conversion of a body to an incorporated company to include incorporated bodies who convert to companies incorporated under the Corporations (Aboriginal and Torres Strait Islander) Act 2006 and making the roll-over more flexible to better accommodate business practices;
- Broadening access to additional CGT roll-overs for Australian resident taxpayers holding interests in entities that restructure using a share or interest sale facility for foreign interest holders; and
- Extending access to CGT demerger relief provisions so that demerger groups which include corporations sole and complying superannuation entities can benefit from the CGT demerger roll-over.
The Assistant Treasurer has now released a consultation paper on the design and implementation of these measures.
The closing date for submissions is Friday 11 June 2010.
TAXVINE NOTE: Due to an error in the Budget papers supplied to us in the Budget lockup, our special Budget edition of TAXVINE - 2010 TAXVINE No 19 (11 May 2010) - incorrectly stated that the third amendment "will correct a defect in the current legislation that prevents demerger groups from accessing demerger relief where the head entity is a corporation sole or a complying superannuation entity". As will now be seen, the amendment is intended to benefit "demerger groups which include corporations sole and complying superannuation entities".