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INCOME TAX ASSESSMENT ACT 1997 - SECT 104.198

Cost of acquisition of replacement asset or amount of fourth element expenditure, or both, not sufficient to cover disregarded capital gain: CGT event J6

             (1)  CGT event J6 happens if you choose a small business roll-over under Subdivision 152-E for a * CGT event that happens in relation to a * CGT asset in an income year and:

                     (a)  by the end of the * replacement asset period, you have done either or both of the following:

                              (i)  * acquired a replacement asset (the replacement asset );

                             (ii)  incurred * fourth element expenditure in relation to a CGT asset (also the replacement asset ); and

                     (b)  at the end of the replacement asset period, the replacement asset is your * active asset; and

                     (c)  if the replacement asset is a * share in a company or an interest in a trust, at the end of the replacement asset period:

                              (i)  you, or an entity * connected with you, are a * CGT concession stakeholder in the company or trust; or

                             (ii)  CGT concession stakeholders in the company or trust have a * small business participation percentage in you of at least 90%; and

                     (d)  the total (the amount incurred ) of the following, in relation to each replacement asset that satisfied paragraph (b) and, if applicable, paragraph (c), is less than the amount of the capital gain that you disregarded:

                              (i)  the first element of the * cost base;

                             (ii)  the * incidental costs you incurred (which can include giving property, see section 103-5);

                            (iii)  the amount of fourth element expenditure incurred.

Note:          You do not have to satisfy the basic conditions in Subdivision 152-A for the gain in relation to CGT event J6 (see subsection 152-305(4)).

             (2)  The time of the event is at the end of the * replacement asset period.

             (3)  You make a capital gain equal to the difference between:

                     (a)  the amount of the * capital gain that you disregarded under Subdivision 152-E; and

                     (b)  the amount incurred.

             (4)  The * replacement asset period may be modified or extended as mentioned in section 104-190.

Table of sections

104-205    Incoming international transfer of emissions unit: CGT event K1

104-210    Bankrupt pays amount in relation to debt: CGT event K2

104-215    Asset passing to tax-advantaged entity: CGT event K3

104-220    CGT asset starts being trading stock: CGT event K4

104-225    Special collectable losses: CGT event K5

104-230    Pre-CGT shares or trust interest: CGT event K6

104-235    Balancing adjustment events for depreciating assets and certain assets used for R&D: CGT event K7

104-240    Working out capital gain or loss for CGT event K7: general case

104-245    Working out capital gain or loss for CGT event K7: pooled assets

104-250    Direct value shifts: CGT event K8

104-255    Carried interests: CGT event K9

104-260    Certain short-term forex realisation gains: CGT event K10

104-265    Certain short-term forex realisation losses: CGT event K11

104-270    Foreign hybrids: CGT event K12



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