# Reviewer verdict — bounty-09-cgt-active-asset-test > **Reviewer:** Harley Dickfos, Tax Agent (TPB 26334789) > **Consent posture:** named > **Reward paid (AUD):** $750 > **Verdict outcome (from reviewer's §6):** FIX > **Verdict date:** 2026-07-14 > **PII sweep:** applied (see build script for pattern set); receipts logged in this PR body. --- --- brief_id: bounty-09-cgt-active-asset-test bounty_title: "CGT small business active-asset test" statutory_anchors: "s 152-35, s 152-40 ITAA 1997; TR 2019/1" reviewer: name: "Harley Dickfos" credential_class: "" # TPB 26334789 registration_status: "" # active jurisdiction: "Australia" attribution_posture: "named" # anonymous reviewed_calculator_version: "" # v0.1-spec submission_date: "" # 2026-07-14 top_level_verdict: "" # FIX verdict_hash: "" # (we compute this on receipt) --- # Reviewer Verdict — CGT small business active-asset test **Bounty:** bounty-09-cgt-active-asset-test ## 1. Top-level verdict _Choose one: **FIX** **Your top-level verdict:** I would conclude that the worked example produces the correct outcome and is broadly consistent with the active asset provisions. However, it should not be treated as a complete calculator specification without further refinement. In particular: the example may imply a 50% threshold that does not appear in the legislation; it assumes floor area is the preferred measurement methodology; it provides limited guidance regarding vacancy periods; it does not adequately address changing ownership or connected-entity relationships over time; and it does not fully explore the interaction between s 152-40(1), s 152-40(1A) and s 152-40(4)(e). Accordingly, the example is best viewed as a useful illustration of the legislative outcome rather than a complete implementation specification. --- ## 2. Per-question verdicts ```yaml per_question_verdicts: - question_number: 1 verdict: "Accept" # ACCEPT citation_authority: "" # section reference or case citation reasoning: | # The three principal limbs in s 152-40(1) are: the asset is used, or held ready for use, in a business carried on by the taxpayer; the asset is used, or held ready for use, in a business carried on by an affiliate; or the asset is used, or held ready for use, in a business carried on by an entity connected with the taxpayer. # Optional — anything surfaced by this question worth banking. - question_number: 2 verdict: "Accept" # ACCEPT citation_authority: "" # section reference or case citation reasoning: | # Under s 152-40(4)(e), an asset is excluded where its main use is to derive rent, unless that use is only temporary. The exclusion applies only where rent-producing use is the asset's predominant use. The derivation of some rent does not, by itself, cause the exclusion to apply. edge_case_notes: | # Optional — anything surfaced by this question worth banking. - question_number: 3 verdict: "Accept" # ACCEPT citation_authority: "" # section reference or case citation reasoning: | # Taxation Ruling TR 2019/1 treats the "main use" inquiry as a comparative question that must be determined having regard to the facts and circumstances. Appropriate indicators may include floor area, rental value, income generation, time-based measures, or other objective methodologies. The focus is on identifying the asset's predominant use in substance. edge_case_notes: | # Optional — anything surfaced by this question worth banking. - question_number: 4 verdict: "Accept" # ACCEPT citation_authority: "" # section reference or case citation reasoning: | # For the purposes of s 152-35, a vacant period will generally count as neither active asset time nor excluded time unless the asset was being held ready for use in carrying on a business. Only periods that satisfy the active asset requirements contribute toward the active asset test. edge_case_notes: | # Optional — anything surfaced by this question worth banking. - question_number: 5 verdict: "" # ACCEPT citation_authority: "Accept" # section reference or case citation reasoning: | # Section 152-40(1A) allows business use by a connected entity or affiliate to be attributed to the asset owner for active asset purposes. Consequently, a lease to a wholly-owned operating subsidiary may still support active asset status, provided the connected entity uses the asset in carrying on a business and the remaining legislative requirements are satisfied. edge_case_notes: | # Optional — anything surfaced by this question worth banking. - question_number: 6 verdict: "FIX" # ACCEPT citation_authority: "" # section reference or case citation reasoning: | # The worked example assumes that ownership, control and connected-entity relationships remain unchanged throughout the ownership period. A calculator should not make this assumption. Because active asset status is tested throughout the ownership period, the calculator should accommodate changes such as: changes in partnership interests; admission or retirement of partners; changes in trust ownership arrangements; changes of trustee; changes in shareholdings affecting connected-entity status; business restructures; and transactions that cause an entity to cease being connected with the asset owner. The calculator should re-assess active asset status whenever a relevant ownership, control or connected-entity change occurs. edge_case_notes: | # Optional — anything surfaced by this question worth banking. ``` --- ## 3. Citation audit _List every statutory section, ATO ruling, or case-law citation the calculator/brief relies on. Mark each: ✓ correct citation / ✗ wrong citation / ⚠ citation exists but is misapplied._ | Section | Status | Notes | |---------|--------|-------| | ITAA 1997 s 152-40(1) | OK | Correctly states the core active asset test: ownership plus use/held ready for use in a business carried on by the taxpayer, affiliate, or connected entity.| | | ITAA 1997 s 152-40(1A) | FIX | Needs review.| | ITAA 1997 s 152-40(4) | Ok | Correctly identified as the exclusions subsection.| | ITAA 1997 s 152-40(4)(e) | Ok | Correctly identified as the rent / interest / royalty / annuity / FX gains exclusion, subject to the temporary-use and development exceptions| | ITAA 1997 s 152-40(4A) | Ok | Correctly supports the rule that, for paragraph (4)(e), affiliate/connected-entity use is treated as your use and personal use is disregarded.| | ITAA 1997 s 152-35 | Ok | Correctly identified as the active asset test section.| | ITAA 1997 s 152-35 (1) | Ok | Correct on the 15-years-or-less / more-than-15-years timing thresholds.| | ITAA 1997 s 152-35(2) | Ok | Correctly describes the “relevant period” for the active asset test.| | ITAA 1997 s 152-78 | Fix | Needs review.| | ITAA 1997 s 152-10(1)(d)| Fix | Needs review.| | TD 2021/2| Ok | Needs review.| | TD 2006/78| Fix | The citation exists and is relevant to premises used in a business providing accommodation for reward, but it is only useful in that specific accommodation/business context. It should not be treated as authority for all mixed-use or ordinary leased-property cases.| | TR 2019/1| Fix | The ruling may be relevant to whether an entity carries on a business, but it does not answer the active asset exclusion question by itself. It should be used only as background, not as the core authority for the calculator’s active asset conclusion.| | TR 2006/10| Fix | This is a public rulings / settlements reference in TD 2021/2, not authority for the substantive active asset logic. It should not be cited as legal support for the calculator’s decision rules.| ## 4. Edge cases surfaced _Anything the brief did not cover that you think should be tested by a future revision.No 1. 2. 3. --- ## 5. TaxGenii appendix coverage feedback _Was the pre-loaded statutory appendix (file 05) adequate? What was missing? Yes --- ## 6. Attestation I have reviewed this bounty artefact bundle on the facts as presented. My verdict above reflects my professional judgement as at the submission date. I understand my verdict will be minted into the public reviewer registry with the attribution posture stated in the frontmatter. **Signed:**HDICKFOS **Name:** Harley Dickfos **Credential:** TPB 26334789 **Date:**14/07/2026