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Edited version of private advice
Authorisation Number: 1051524357630
Date of advice: 31 May 2019
Ruling
Subject: CGT - Deceased Estate - 2 year extension.
Question
Will the Commissioner exercise the discretion under subsection 118-195(1) of the Income Tax Assessment Act 1997 (ITAA 1997) and extend the 2 year period on the disposal of the dwelling in order for capital gains tax liability to be disregarded?
Answer
Yes
This ruling applies for the following period
Year ending 30 June 20xx
The scheme commences on:
1 July 20xx
Relevant facts and circumstances
The deceased passed away in November 20XX.
Probate was issued three months later.
The deceased's principal place of residence (the dwelling) was sold approximately two years and three months after the deceased's date of death.
The sale price exceeded the valuation of the dwelling at the deceased's date of death (i.e. there was a capital gain on the sale of the dwelling).
The sale of the property was delayed due to the conduct of the tenant, who ultimately purchased the dwelling. This delay was outside the control of the taxpayer.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 118-195