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Edited version of private advice
Authorisation Number: 1052286333091
Date of advice: 2 August 2024
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 (ITAA 1997) to allow an extension of time to dispose of the ownership interest in the Property and disregard the capital gain 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 ended 30 June 20XX
The scheme commenced on:
1 July 20XX
Relevant facts and circumstances
The deceased passed away a few years ago.
The deceased purchased the property before 1985.
The property was the deceased's main residence just before they passed away.
The property was less than 2 hectares in size.
The property was never used to produce assessable income prior to or after their death.
The property remained vacant from the date of death until it was sold.
The deceased died intestate.
Letters of administration were issued a couple of years after the date of death.
The reasons for the property not being sold within the 2 year legislated time frame is as follows:
• The deceased passed away intestate
• The deceased was under a financial management order
• The authorised trustee attempted to locate the deceased's children
• Initially only one of the deceased's children was willing to give permission for the estate to be administered.
• Another child of the deceased was also under a financial management order
• Authority was received from the deceased's children at different times over the course of a number of months
• Letters of administration were only obtained after receiving authorisation from the children
• Property settled several months later
Relevant legislative provisions
Income Tax Assessment Act 1997 section 118-195
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