EV 1052288797508currentnon-binding advice

Capital gains tax

Non-binding edited private advice. This is an edited version of private advice the ATO gave to a specific taxpayer about their own circumstances. You cannot rely on it — it is not binding and provides no protection for anyone else (see PS LA 2008/4). Use it as a guide to the ATO’s thinking, not as authority.

1

Did CGT event A1 happen to you upon implementation of the Scheme of Arrangement?

2

Yes. CGT event A1 happens if there is a change in the ownership of a CGT asset (section 104-10 of the Income Tax Assessment Act 1997 (ITAA 1997)). The event happens when you enter into a contract to dispose of the asset or if you have not entered into a contract, when the change of ownership occurs (subsection 104-10(3) of the ITAA 1997). The disposal of your shares under a court approved Scheme of Arrangement results in a disposal of shares, but not because you entered into a contract for disposal. Therefore, CGT event A1 happened on the scheme implementation date when there was a change of ownership in a Company A share from you to Company B under the Scheme of Arrangement (subsections 104-10(1) and (2) and paragraph 104-10(3)(b) of the ITAA 1997). This ruling applies for the following period : Year ending 30 June 20XX The scheme commenced on: XX XX 20XX

3

You held shares in a company (Company A). Company A was acquired by another company (Company B). The scheme was implemented on XX XX 20XX at which time your shares were acquired by Company B.

4

Income Tax Assessment Act 1997 section 104-10 (3)