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Edited version of private advice
Authorisation Number: 1051830549568
Date of advice: 5 May 2021
Ruling
Subject: CGT - deceased estate
Question
Will the Commissioner allow an extension of time for you to dispose of your ownership interest in the dwelling and disregard any capital gain or loss you made on the disposal?
Answer
Yes. Having considered the circumstances and the relevant factors the Commissioner will allow an extension of time under subsection 118-195(1) of the Income Tax Assessment Act 1997. 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 YYYY
The scheme commences on:
DD/MM/YYYY
Relevant facts and circumstances
The deceased passed away on DD/MM/YYYY.
The deceased acquired the dwelling post capital gains tax.
The dwelling was the deceased's main residence for the whole ownership period.
Probate was granted on DD/MM/YYYY.
The beneficiaries were appointed as joint executors and equal beneficiaries of the deceased's estate.
The beneficiaries inherited the dwelling from the deceased's estate. The beneficiaries decided to sell the dwelling.
After probate was granted, the beneficiaries began visiting the dwelling to remove the deceased's belongings. While conducting these activities, the beneficiaries noticed some repairs, that were required to be completed by the insurance company prior to the deceased's death, were incomplete.
The beneficiaries contacted the strata manager and insurance company regarding the incomplete repair works.
On DD/MM/YYYY, one of the beneficiaries was injured and unable to personally complete works to the dwelling for X months.
In MM/YYYY, the insurance company completed the repair works.
In MM/YYYY, one of the beneficiaries commenced a dispute with the insurance company regarding further incomplete repairs that were required to be completed prior to the deceased's death (the further repairs).
On DD/MM/YYYY the insurance company approved the further repairs to be completed.
In MM/YYYY, the further repairs were completed by the insurance company.
After the further repairs were completed by the insurance company, the beneficiaries finished preparing the dwelling for sale.
In MM/YYYY, the dwelling was taken on by a real estate agent as an off-market listing.
The beneficiaries received an offer to purchase the dwelling from a private buyer. This offer fell through due to the buyer being unable to obtain finance.
COVID-19 restrictions caused further delay in the sale of the property.
On DD/MM/YYYY, the beneficiaries entered into the Contract for Sale of the dwelling with the buyer.
Title to the dwelling was transferred to the beneficiaries on DD/MM/YYYY, prior to settlement.
Settlement of the Contract of Sale occurred on DD/MM/YYYY, approximately two years and one month after the deceased passed away.
Relevant legislative provisions
Income Tax Assessment Act 1997 subsection 118-195(1)
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