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Edited version of private advice
Authorisation Number: 1051726459355
Date of advice: 23 July 2020
Ruling
Subject: Capital gains tax - deceased estate - two year discretion
Question
Will the Commissioner allow an extension of time to dispose of your ownership interest in the dwelling (and two hectares of surrounding land) so you can disregard the capital gain you make on the disposal?
Answer
Yes
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 decease passed away in 20XX.
The dwelling is situated on land which is approximately x hectares in size.
The dwelling was the deceased's main residence.
The executor named in the Will renounced the role.
The Will listed a number of beneficiaries.
An organisation was initially approached to administer the estate however were reluctant to do so.
The organisation reconsidered its position around 20xx and an application was made to administer the estate.
The delay in the organisation being appointed contributed to some of the delays in attending to the sale of the dwelling.
The property was sold on the XX 20XX
Settlement occurred on XX 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)
Further information
The main residence exemption extends to a maximum of two hectares of land adjacent to the dwelling, including the area of the land on which the dwelling is built (exempt land).
Where land exceeds two hectares, Taxation Determination TD 1999/67 (TD 1999/67) outlines how to calculate any capital gain or capital loss on land in excess of the two hectares for the main residence exemption.