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Edited version of private advice
Authorisation Number: 1051514228475
Date of advice: 9 May 2019
Ruling
Subject: Income Tax - Deceased estate - 2 year discretion
Question
Will the Commissioner exercise his discretion under subsection 118-195(1) of the Income Tax Assessment Act 1997 (ITAA 1997) and allow an extension of time to the two year period?
Answer
Yes. Having considered your circumstances and the relevant factors, the Commissioner will allow an extension of time. Further information about this discretion can be found by searching 'QC 52250' on ato.gov.au
This ruling applies for the following period:
Year ended 30 June 20XX
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
The deceased acquired a dwelling after 20 September 1985. The property is less than 2 hectares.
The deceased passed away after 20 September 1985.
The dwelling was the deceased's main residence and was not used to produce assessable income.
The executor was reluctant to accept the role due to considerable grief arising from the deceased's death.
The dwelling had two separate events of storm damage. This required extensive repairs and maintenance before advertising on the market.
The executor, the dwelling and the deceased's accountant were in three different states. The administration of the estate was complex and was difficult to co-ordinate.
The executor undertook carer responsibilities for her niece, as her sister was involved in two serious car accidents.
Probate was granted three years after the deceased's death.
The dwelling was advertised and sold within one month after probate was granted.
The dwelling remained vacant until the executor sold it.
Settlement occurred three years and three months after the deceased's death.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 104-10
Income Tax Assessment Act 1997 subsection 118-130(3)
Income Tax Assessment Act 1997 section 118-195