# Bounty #09 — Public review brief: CGT SB Active-Asset Test

**Bounty ID:** bounty-09-cgt-active-asset-test
**Domain:** CGT small business — active-asset test
**Statutory anchors:** s 152-35, s 152-40 ITAA 1997; TR 2019/1
**Calculator target:** **Spec-first bounty** — no existing calculator. Reviewer authors the ratification spec.
**Expected effort:** ~2.5 hours
**Prize:** AUD $750

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## 1. Why this bounty exists

The active-asset test is a gating condition for all four SB CGT concessions (15-year exemption, 50% reduction, retirement exemption, rollover). It is applied per asset. It has three components:

1. **Definition of active asset** — s 152-40 lists what counts (used in business, held ready for use, intangibles connected to business).
2. **Exclusions** — s 152-40(4) excludes assets whose main use is deriving rent, interest, annuities, royalties, or holding foreign-currency-fluctuation instruments.
3. **Half-of-ownership test** — s 152-35: the asset must have been an active asset for at least half the period of ownership (or 7.5 years if owned > 15 years).

TR 2019/1 clarifies the "main use" test for mixed-use assets, especially commercial premises partly rented out.

We do not yet have a calculator for this. This bounty asks a competent CGT practitioner to author the ratification spec.

## 2. What the spec must cover

- Component 1: is the asset within the s 152-40(1) inclusive list?
- Component 2: is it excluded under s 152-40(4)?
- Component 3: has it been an active asset for the qualifying period?
- The TR 2019/1 mixed-use methodology — proportional main-use analysis.
- Interaction with connected-entity holding (asset held by one entity but used by a connected entity — s 152-40(1A)).

## 3. Out of scope

- The other SB CGT concessions' additional conditions (see Bounty #8 for 15-year).
- Non-SB CGT event characterisation.
- GST on the underlying disposal.