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18 Feb 13 Disposal pursuant to binding Heads of Agreement

The AAT has held that a Heads of Agreement entered into between the taxpayer and the purchaser of the taxpayer's business was a binding agreement, such that CGT event A1 occurred on its execution, notwithstanding that the parties subsequently executed a Contract of Sale of Business.

Although both documents were executed in the same income year, the timing of the CGT event was critical in determining whether the taxpayer satisfied the maximum net asset value test just before the CGT event (s152-15) for the purposes of the small business CGT concessions in Div 152 of ITAA 1997.

Confidential and FCT [2013] AATA 76 (AAT, Fice SM, 15 February 2013)


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