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Edited version of private advice
Authorisation Number: 1052394553449
Date of advice: 27 May 2025
Ruling
Subject: Commissioner's discretion - deceased estate
Question 1
Will the Commissioner exercise the discretion under section 118-195 of Income Tax Assessment Act 1997 to allow an extension of time for you to dispose of your ownership interest in the dwelling and disregard the capital gain or capital loss you made on the disposal?
Answer 1
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
The scheme commence on:
XX XX 20XX
Relevant facts and circumstances
In 20XX One of the deceased children person A moved into live with the deceased as their carer.
Person A has been on a disability pension for the past X years, after recovering from cancer.
Person A suffered from a variety of chronic illnesses which prevented them from being able to be employed and they could not afford to live anywhere else.
On XX XX 20XX the deceased purchased a property located XX XX XX (the property).
On XX XX 20XX the deceased passed away.
The property is less than 2 hectares in size.
The property was the deceased's main residence until they passed away.
The property was never used for the purpose of producing income during the deceased's ownership.
You provided a copy of the will dated XX XX 20XX.
On XX XX 20XX Probate was granted to you and person A, you both were appointed as the executors of the will.
Early January 20XX the deceased other children demand immediate sale of the property.
On XX January 20XX, A solicitor representing person A sent a letter regarding issue of proceedings. This letter has been supplied in the application.
The letter outlines the following;
1. Person A age and health conditions. No support from a spouse or children.
2. Person A has minimal assets.
3. Person A health is extremely poor, and their life expectancy is limited.
4. Person A lived with the deceased for X years prior to the deceased death and acted as their main carer.
In March 20XX person A commenced proceedings in the Supreme Court under Part IV of the Administration and Probate Act 1958.
Person A was seeking an order that further provision for maintenance and support be made for them out of the estate (the Part IV proceeding).
A right to reside was granted as per the terms of settlement and release.
On XX May 20XX Terms of Settlement and Release via the Supreme Court were signed. This document has been provided in the application.
On XX April 20XX A Tax File Number for the estate was applied for.
Sometime in the second half of 20XX person A decided to move out of the residence due to the increasing cost of living which included its upkeep and ongoing maintenance of the property.
On XX November 20XX a contract for the sale of the property was entered.
On XX January 20XX person A moved out of the property.
On XX February 20XX the property settled.
The property was sold by the executors.
The estate has fully been administered.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 118-195
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