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Edited version of private advice
Authorisation Number: 1051715311064
Date of advice: 19 August 2020
Ruling
Subject: Capital gains tax
Question
Will the Commissioner provide an extension of time for you to dispose of your ownership interest in the dwelling and disregard the capital gain you make on the disposal?
Answer
No.
This ruling applies for the following period:
Year ending 30 June 20XX
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
You left Australia at the beginning of 20XX.
You currently live in Country Z.
You have a property in Australia that you have tried to sell.
You understand that as non-residents of Australia for taxation purposes you will not receive the capital gains tax exemption on the sale of the property after 30 June 2020.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 118-110
Reasons for decision
When you dispose of a Capital Gains Tax (CGT) asset a CGT event occurs. The most common event is CGT Event A1 and this occurs when you dispose of your ownership interest in real property. However, in some cases even though a CGT event occurs taxpayers may disregard any capital gain or loss if they are entitled to an exemption. The most common exemption relating to property is the main residence exemption.
Section 118-110 of the Income Tax Assessment Act 1997 (ITAA 1997) details the circumstances under which the main residence exemption can be claim as well as the restrictions which apply to foreign residents. It does not provide the Commissioner with discretion to extend the date in which a non-resident may still claim the main residence exemption.
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