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Edited version of private advice
Authorisation Number: 1052226132198
Date of advice: 22 March 2024
Ruling
Subject: CGT - deceased estate
Question
Is the Testamentary Trust deemed to have acquired X (the Property) under the deceased's will in accordance with subsection 118-210(1) of the Income Tax Assessment Act 1997 (ITAA 1997)?
Answer
Yes. Having considered your circumstances and the relevant factors, the Commissioner agrees Property 2 was acquired under the will of the deceased in accordance with our view in Taxation Determination (TD) 1999/74 Income tax: capital gains: in what circumstances does a trustee of a deceased estate acquire an ownership interest in a dwelling 'under the deceased's will' for the purposes of subsection 118-210(1) of the Income Tax Assessment Act 1997?
This ruling applies for the following period:
Year ended 30 June 20XX
The scheme commenced on:
XX XX 20XX
Relevant facts and circumstances
Person A passed away on XX XX 19XX.
As at the date of death, Person A (the Deceased) owned the dwelling located at X (Property 1).
Property 1 was situated on less than two hectares of land and was the main residence of the Deceased as at the date of their death in 19XX.
The Deceased left a will directing X (the Trustee) to hold the residue and remainder of the estate upon trust for their child, Person B (the Life Tenant).
On XX XX 19XX probate was granted to the Trustee in accordance with the will.
The Life Tenant elected to reside in Property 1 as their main residence in accordance with the will.
On XX XX 19XX Property 1 was sold by the Trustee and a replacement property (Property 2) was purchased with the proceeds of sale from Property 1.
Property 2 was purchased within the X Testamentary Trust.
Property 2 is situated on less than two hectares of land and was the main residence of the Life Tenant for the remainder of their life.
Person B passed away on XX XX 20XX.
Property 2 remained vacant until the property was transferred to the remaining beneficiaries in XX 20XX.
The Property 2 title was transferred to the remaining beneficiaries as tenants in common in XX 20XX in accordance with the will.
Relevant legislative provision
Income Tax Assessment Act 1997 section 118-210
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