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Edited version of private advice
Authorisation Number: 1051809590026
Date of advice: 25 February 2021
Ruling
Subject: Capital gains tax
Question
Will the Commissioner allow an extension of time to late 20XX for you to dispose of your ownership interest in the dwelling and disregard the capital gain you make on the disposal?
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 passed away late 20XX.
The property was the main residence of the deceased up until the date of death.
The children of the deceased sought financing with the intention of purchasing the property.
The dwelling was constructed personally by the deceased and had not been finalised with the local council for occupancy or sale purposes.
During late 20XX the Executors visited the property and became aware of significant issues with the property that would need to be corrected in order to receive final building inspection and occupancy approval from the local council. The Executors then engaged a builder to correct the issues with the property.
In late 20XX, when the deceased's children were unable to proceed with the purchase of the property, the Executors made initial enquiries with a real estate agent to manage the sale.
In early 20XX the Executors returned to the property to undertake various work and prepare the property for sale.
A contract for sale was entered into in mid 20XX.
On multiple occasions, the purchaser requested additional time for settlement in order to meet the building certification standards of the local council and due to the length of time dealing with the council the first contract expired.
A second contract was entered into in mid 20XX with an extended settlement period.
The second contract was settled on late 20XX.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 118-195
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