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Edited version of private advice
Authorisation Number: 1051798404995
Date of advice: 20 January 2021
Ruling
Subject: Capital gains tax - deceased estate - two-year extension of time
Question
Will the Commissioner allow an extension of time for the Estate to disregard the capital gain or capital loss made on disposal of the deceased's main residence?
Answer
Yes. Having considered your circumstances and the relevant factors, the Commissioner will allow an extension of time. Further information about this discretion can be found by searching 'QC 52250' on ato.gov.au.
This ruling applies for the following period:
Year ending 30 June 20XX
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
The deceased acquired property before 1985 (pre-CGT) and this was the deceased's main residence until date of death.
The deceased demolished the existing dwelling post-CGT and constructed a new dwelling, still being their main residence.
In 20XX the deceased moved out of the main residence and lived elsewhere until their date of death.
The deceased's dwelling was producing income from 20XX until settlement date.
The deceased passed away in 20XX.
The property was first placed on the market for sale in 20XX.
In 20XX, it was identified that the property had a restrictive covenant placed over it.
The trustees took all the necessary steps to remove this restrictive covenant, including court action.
This took some time for the restrictive covenant to be removed and this happened in 20XX.
The property was placed on the market again in 20XX.
Settlement on the sale of the property occurred.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 104-10
Income Tax Assessment Act 1997 section 118-195
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