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Edited version of private advice
Authorisation Number: 1051529813044
Date of advice: 13 June 2019
Ruling
Subject: Main residence exemption
Question
Are you entitled to disregard the entire capital gain made on the disposal of the deceased's main residence?
Answer
Yes. The estate has satisfied the requirements of section 118-195 of the Income Tax Assessment Act 1997 (ITAA 1997). As the period of time that the property was used for income producing purposes up to the date of death was less than six years, the income producing use of the property can be disregarded in accordance with section 118-190(4) of the ITAA 1997. Accordingly, the capital gain made on the sale of the property can be disregarded.
This ruling applies for the following period:
Year ending 30 June 2019
The scheme commences on:
1 July 2018
Relevant facts and circumstances
The property was jointly purchased.
State Trustees were appointed via Victorian Civil and Administrative Tribunal (VCAT) due to medical condition.
The deceased and spouse moved from the property to a private nursing home. They did not own any other properties.
The property was used to produce rental income.
The spouse of the deceased passed away and their share in the property passed to the deceased.
The deceased passed away.
The property continued to be rented following the death of the deceased.
The property was sold.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 118-195(1)
Income Tax Assessment Act 1997 Section 118-190(4)