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Edited version of private advice
Authorisation Number: 1052118937450
Date of advice: 16 May 2023
Ruling
Subject: Commissioner's discretion - deceased estate
Question
Will the Commissioner exercise the discretion under section 118-195 of the Income Tax Assessment Act 1997 to allow an extension of time for you to dispose of your ownership interest in the property and disregard the capital gain or loss you made on the disposal?
Answer
Yes.
Although renovation work is not a factor favourable to exercising the Commissioner's discretion, this only accounted for a few months of the delay compared to the X year period of delay caused by the legal dispute which was out of your control. Having considered all of your circumstances in their entirety and the relevant factors the Commissioner will allow an extension of time. Further information about the Commissioner's discretion can be found by searching ato.gov.au for 'QC 66057'.
This ruling applies for the following period:
Income year ended 30 June YYYY.
The scheme commenced on:
DD/MM/YYYY
Relevant facts and circumstances
On DD/MM/YYYY the deceased passed away leaving a Will.
The deceased had acquired the property several years ago. The property was less than two hectares in area. It was the deceased's main residence just before their death and was not used to produce income at that time.
You are a beneficiary of the Will.
On DD/MM/YYYY probate of the deceased's Will was granted.
On DD/MM/YYYY a family provision claim was lodged by another relative of the deceased.
The legal dispute took X years to be resolved.
Shortly after the dispute was resolved, title to the property was transferred to you as a beneficiary.
Due to the property having been left vacant since the deceased's death, you undertook work on the property for a few months before placing it on the market for sale.
The property was on the market for less than a month before a sale contract was entered into and the sale settled less than two weeks later.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 118-195
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