Disclaimer
This edited version has been archived due to the length of time since original publication. It should not be regarded as indicative of the ATO's current views. The law may have changed since original publication, and views in the edited version may also be affected by subsequent precedents and new approaches to the application of the law.

You cannot rely on this record in your tax affairs. It is not binding and provides you with no protection (including from any underpaid tax, penalty or interest). In addition, this record is not an authority for the purposes of establishing a reasonably arguable position for you to apply to your own circumstances. For more information on the status of edited versions of private advice and reasons we publish them, see PS LA 2008/4.

Edited version of private advice

Authorisation Number: 1051632693512

Date of advice: 5 February 2020

Ruling

Subject: Capital gains tax - deceased estate - 2 year discretion

Question

Will the Commissioner allow an extension of time for you to dispose of your ownership interest in the dwelling and disregard the capital gain you make on the disposal?

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 2020.

The scheme commences on

1 July 2019.

Relevant facts

The deceased acquired a dwelling (the dwelling).

The deceased passed away in 20xx.

The dwelling was the deceased's main residence.

The deceased returned to another country in later years to reside closer to family.

The dwelling remained vacant and was not used to produce assessable income.

The deceased prepared a Will in 20xx whilst residing outside Australia.

The process of proving and validating a Will in the overseas country is an involved process and the trustee experienced delays that included:

·        A potential beneficiary indicated that they would make a claim on the estate.

·        The overseas lawyer administering the estate required significant time to complete the requirements of proving the overseas Will in Australia.

·        An Australian lawyer was engaged to assist in the process, however this lawyer became ill and retired without completing the administration of the estate.

·        A specialist lawyer was then engaged in 20xx to provide advice on what was required to occur in Australia.

·        Language barriers were experienced including requirements to have documents translated and certified.

Probate was granted in 20xx.

The dwelling was prepared for sale.

A contract was entered into in 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)