Once you’ve worked out you have a capital gain for a CGT event and you’ve used one of the 3 calculation methods to work out your net capital gain, you can look at whether you’re eligible for a general CGT exemption or rollover. These may allow you to disregard, defer or reduce the net capital gain.

There are many ways a general CGT exemption or rollover may apply, and some may give you better outcomes than others depending on your circumstances. Seek advice from a registered tax adviser or the ATO to help you understand what CGT exemptions or rollovers you may be eligible for.

Small businesses have additional CGT concessions that allow you to reduce, defer or disregard your capital gains when you sell your business assets. These concessions are in addition to the general CGT exemptions and rollovers available more widely.

One way to consider the order in which an exemption, rollover or concession applies to reduce the capital gain is to ask the following questions:

• Can I disregard the capital gain because an exemption applies, such as the main residence exemption? If yes, you can disregard the gain.
• If no, am I eligible for the small business 15-year exemption (one of the available CGT concessions)? If yes, you won’t have a capital gain when you sell the asset.
• If no, do I have capital losses from the current income year or previous income years which I can subtract from the capital gain?
• If the event still results in a capital gain, what method do I use to calculate the capital gain:
  • discount method
  • indexation method
  • ‘other’ method?
• If the event still results in a capital gain, can I use a general CGT rollover to defer it?
• If not, can I use one of the remaining 3 small business CGT concessions:
  • small business 50% active asset reduction
  • small business retirement exemption
  • small business rollover.