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Edited version of private advice
Authorisation Number: 1051560094714
Date of advice: 6 August 2019
Ruling
Subject: Income tax - Deceased estate - 2 year discretion
Question
Will the Commissioner allow an extension of time for the Executors to dispose of their ownership interest in the property and disregard the capital gain they make on the disposal?
Answer
Yes. Having considered the 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
The deceased passed away in 20XX
The dwelling was the deceased's main residence.
The property size is less than two hectares.
The dwelling was not used to produce assessable income.
No capital improvements were undertaken on the property from date of Probate to sale of property.
The deceased had X children, which caused delays in the property being listed on the market for sale. As the children were dealing with their emotions of their parent passing and the logistics of being able to get agreement from all children to place the property for sale.
A real estate agent was appointed in 20XX to place the property on the market for sale.
The property was sold shortly after in 20XX.
The property was subject to several delayed settlements by the buyer due to cashflow requirements, a short settlement was not obtained and both the original settlement dates were extended by deed of contract variation to 20XX.
Settlement occurred in 20XX.
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
Income Tax Assessment Act 1997 subsection 118-195(1)