Edited version of private advice

Authorisation Number: 1052141351602

Date of advice: 15 August 2023

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 located at the Property and disregard the capital gain or loss you made on the disposal?

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 period:

Year ending 30 June 20XX

Year ending 30 June 20XX

The scheme commenced on:

1 July 20XX.

Relevant facts and circumstances

The Deceased passed away on DD MM 20XX.

As at the date of death:

•         The Deceased owned the Property which had been acquired prior to 20 September 1985 and was less than 2 hectares in size.

•         The Property was the Deceased's main residence until their passing.

•         The Will provided the Estate was to be distributed between the beneficiaries, Person A and Person B in equal shares. The Will nominated Person A and Person B as co-Executors.

Person B resides in Country X. Person B's ability to assist with the administration of the estate and disposal of the Property was restricted due to COVID-19 travel restrictions.

Person A is totally and permanently disabled. Person A underwent surgery shortly prior to the Deceased's death and was placed on heavily restricted activity for a many months. Person A's ability to attend the Property was limited due to Covid restrictions in place for metropolitan Melbourne and driving restrictions following their surgeries.

On DD MM 20XX, Person A commenced the probate process. Person A engaged an online solicitor due to Covid restrictions and their inability to drive.

On or around DD MM 20XX, Person A was admitted to hospital for surgery, which involved additional recovery time and limitations on driving for many months. Person A did not expect to be undergoing surgery at this time.

Probate was granted on DD MM 20XX. There were complexities and delays as Person B renounced their role as co - executor.

Person A was appointed sole executor.

Person A had significant ongoing health issues in early to mid 20XX which impacted on their ability to attend the Property and undertake the required works.

The Property, both dwelling and yard, were in a state of disrepair. Every room in the house was filled with belongings. The sheds on the Property were also full of belongings and tools. The works undertaken at the Property to ensure it was ready for sale included:

•         Removing a number of rubbish skips of belongings.

•         Extensive cleaning inside the home.

•         Clean-up of the yard.

•         Necessary repairs to the roof to avoid further water damage inside the Property.

•         Sorting through the Deceased's paperwork.

•         Attempts to have Person B attend to their belongings at the Property and eventually disposal of these belongings.

•         Arranging for furniture and tools to be donated.

•         Attempts to have estate dealers attend on the Property.

On or around DD MM 20XX, Person A underwent surgery.

On or around DD MM 20XX, Person A underwent a further surgery involving additional recovery time.

Person A's health issues resolved in MM 20XX.

Person A engaged a real estate agent on or around DD MM 20XX.

The Property was sold on DD MM 20XX with settlement occurring DD MM 20XX.

Relevant legislative provisions

Income Tax Assessment Act 1997 section 118-195.

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