Sladen Snippet: Business Restructure Roll-Overs Extended in New Tax Law

The Tax and Superannuation Laws Amendment (2014 Measures No 6) Bill 2014 (the Bill) was introduced to Parliament on 30 October 2014.

Schedule 1 of the Bill seeks to amend the Income Tax Assessment Act 1997 to extend the CGT roll-over relief afforded under certain replacement asset roll-overs to revenue assets and trading stock.

Key changes include:

  • Revenue asset and trading stock roll-overs are now available for exchange of units in a unit trust for shares in a company – with effect from 10 May 2014.
  • Revenue asset and trading stock roll-overs for exchange of shares in one company for shares in another company are no longer limited to consolidated groups– with effect from 8 May 2012.
  • The business restructure roll-overs only apply where the new asset has the same character (as a revenue asset or trading stock) as the original asset – with effect from 7.30 pm on 8 May 2012.
  • A trust transferring an asset to a company or another trust may access a CGT roll-over if the receiving entity holds rights that are used to facilitate the transfer of assets to that entity. Previously, the receiving entity was not able to hold any assets other than a small amount of cash or debt. This change takes effect from:
    • 1 November 2008 for transfers between trusts; and
    • 7.30 pm on 10 May 2011 for transfers from trusts to companies.
  • The revenue asset roll-over for exchange of shares in one company for shares in another company allows interest holders to defer a profit or loss on the exchange of shares under a corporate restructure.

It should be noted that the amendments proposed do not affect a scrip for scrip roll-over under Sub-Division 124-M at the current time – there is no scrip for scrip roll-over relief in respect of interests held as revenue assets.

The Bill was passed by the House of Representatives on 25 November 2014 and introduced to the Senate on 26 November 2014. It is expected to be enacted into legislation in the coming weeks.

For more information on these issues please contact:

Daniel Smedley
Principal | Accredited Specialist in Tax Law
Sladen Legal
M +61 411 319 327  |  T +61 3 9611 0105


Renuka Somers
Special Counsel
Sladen Legal
M +61 407 478 592  |  T +61 3 9611 0110


Kristy Merganovski
Sladen Legal
T +61 3 9611 0116