ATO Grants Capital Gains Tax Roll-Over Relief to Astron Shareholders

Background to the Redomicile

Astron Limited, a mineral sands and rare earths company with a strong Australian presence, recently completed a significant corporate restructuring by redomiciling its parent company from Hong Kong to Australia. This move, formalised through a scheme of arrangement implemented on 29 August 2025, saw the replacement of Hong Kong-registered Astron Corporation Limited securities with shares in the newly established Australian entity on a two-for-one basis.

The redomicile is designed to streamline the group’s corporate framework by co-locating its registered office and principal assets within Australia. This alignment is expected to remove complexities associated with trading CHESS Depositary Interests on the ASX and improve shareholder engagement by reinforcing Astron’s identity as a distinctly Australian company.

ATO Class Ruling and Tax Implications

A key development following the redomicile is the Australian Taxation Office’s issuance of Class Ruling CR 2025/79. This ruling clarifies the tax treatment for eligible securityholders; those holding shares, CDIs, or options on capital account who are either Australian residents or foreign residents with taxable Australian property.

Under the ruling, eligible shareholders can elect capital gains tax (CGT) roll-over relief. This means they can defer any capital gains tax liability arising from the exchange of their Hong Kong securities for Astron Limited shares. Importantly, the cost base of the new shares or options will be the same as the original securities, and for CGT discount purposes, the acquisition date is preserved. This tax deferral can be a significant advantage for investors, allowing them to manage their tax obligations more strategically.

Shareholder Actions and Next Steps

To benefit from the roll-over relief, shareholders must notify Astron Limited of their election by completing and returning a Roll-over Election Form to the company’s share registry, Computershare. Additionally, they must reflect this election in their 2026 income tax return by excluding any capital gain from the disposal of their original securities.

Astron Limited has provided resources and contact points for shareholders needing assistance with the election process, underscoring the company’s commitment to facilitating a smooth transition. However, the uptake of this relief will depend on individual shareholder circumstances and their engagement with the process.

Strategic Outlook

This tax ruling and the successful redomicile mark important milestones for Astron as it continues to develop its Donald Rare Earth and Mineral Sands Project in Victoria, a venture with the potential to become a globally significant supplier of critical rare earth elements. By consolidating its corporate presence in Australia and clarifying tax positions for investors, Astron is positioning itself to attract and retain shareholder support while simplifying its operational footprint.

Investors and analysts will be watching closely to see how the market responds to these changes and whether the tax relief encourages greater shareholder participation and confidence in the company’s long-term strategy.