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The ATO is cracking down on capital gains tax (CGT) concessions after finding that a number of larger and wealthier businesses are issuing a claim they are not entitled to.
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ATO circles ineligible CGT concessions
17 November 2021
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According to a statement from the ATO on Tuesday (16 November), there has been a noticeable trend of some businesses mistakenly claiming small-business CGT concessions in recent income tax returns.
“If your clients have claimed one or more small business CGT concessions in recent income tax returns, you or your clients may receive a letter from us,” the ATO flagged.
“The letter will ask you to check your clients’ claims and ensure that they meet the basic eligibility conditions, and that they have records to substantiate their claim.”
The Tax Office said tax professionals are encouraged to check all their clients’ recent or planned future small-business CGT concession claims, ensuring they are accurate.
“To ensure small business CGT concession eligibility and avoid administrative time to correct a mistake you can: reach out to us for an early engagement discussion to seek advice on your client’s small business complex transaction; seek a pre-lodgment compliance agreement for your client’s commercial deals and restructure events; [or] apply for a private ruling to attain certainty on your client’s application of small business CGT concessions,” the ATO said.
“You can see what attracts our attention for small business CGT concessions and contact us if you identify an error with any of your [clients’] claims.”
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