Income tax: capital gains: is there roll-over under section 126-5 or 126-15 of the Income Tax Assessment Act 1997 if a CGT asset is transferred in accordance with the terms of a court order under the Family Law Act 1975 but after the time limit specified in the court order?

Yes. A CGT event A1 (about disposals of CGT assets) in section 104-10 of the Income Tax Assessment Act 1997 (ITAA 1997) happens on a transfer of a CGT asset by one spouse to another. If the asset is transferred in accordance with a court order under the Family Law Act 1975, even if the transfer occurs after the time limit specified in the court order, we accept for capital gains purposes that the CGT event happens 'because of' the court order. In essence, the CGT event - namely the transfer of the CGT asset - is caused by the court order even if it is done later than the court order requires. There is roll-over under section 126-5 or 126-15 of the ITAA 1997.

A CGT event happens 'because of' a court order if the CGT event is caused by the court order.

A court order requires Bill to transfer 100 XYZ Corp shares to his spouse, Linda, within 3 months. The shares are transferred 4 months later. There is roll-over on the transfer of the shares, despite the transfer happening after the period specified in the court order.