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Edited version of private advice
Authorisation Number: 1052122967877
Date of advice: 26 May 2023
Ruling
Subject: Commissioner's discretion - deceased estate
Question
Will the Commissioner exercise the discretion in section 118-195 of the Income Tax Assessment Act 1997 (ITAA 1997) to extend the two-year period and disregard any capital gain made on the disposal of the property?
Answer
Yes.
Having considered your circumstances 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 periods:
Year ended 30 June 20XX
Year ended 30 June 20XX
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
The property at XXXX was purchased by the deceased before September 1985.
The property is less than 2 hectares.
The property title was transferred as joint tenants between the deceased and his partner on XX XX 20XX.
The deceased passed away on XX XX 20XX.
The property was the deceased's main residence at the time of death and never used to produce income.
Probate was granted on XX XX 20XX to the deceased's partner.
Pursuant to the leave granted under the first probate, a second probate was granted on XX XX 20XX to the adult children of the deceased the other executors and trustees with the deceased's partner.
On XX XX 20XX, pursuant to Supreme Court proceedings brough by the adult children, the previous title transfer into joint names of the deceased and the partner was set aside. The deceased's partner's son replaced the partner as trustee. The partner was instructed to transfer the title to the trustees of the deceased's will. The property title transfer was completed on XX XX 20XX.
Under the deceased's will, the partner was granted a life interest in the property until their death or remarriage. The partner resided at the property until their death on XX XX 20XX without having remarried.
A contract for sale of the property was signed on XX XX 20XX with settlement on XX XX 20XX.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 118-195
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