| Disclaimer 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: 1051845347494
Date of advice: 10 June 2021
Ruling
Subject: CGT - deceased estate - right to occupy
Question 1.
Will the Commissioner allow an extension of time for you to dispose of your ownership interest in the dwelling and disregard the capital gain or loss you made on the disposal?
Answer
Yes. Having considered your circumstances and the relevant factors the Commissioner will allow an extension of time. Further information about the Commissioner's discretion can be found by searching 'QC 52250' on ato.gov.au
Question 2.
Is the capital gain disregarded, notwithstanding the fact that some of the beneficiaries of the Deceased Estate are non-residents?
Answer
Yes. The Commissioner has provided the discretion in question 1 of the private ruling and disregarded the capital gain or loss. It doesn't matter if the beneficiaries are resident or non-residents of Australia for income tax purposes when it comes to inheritance of Taxable Australian Property. Further information about deceased estate and capital gains tax can be found by searching 'QC 52245' on ato.gov.au
Question 3
Is the Trustee liable to pay tax on any part of the capital gain from the disposal of the property under any other provisions of tax law?
Answer
No. The capital gain has been disregarded by the Commissioner. However, the trustee will be liable for tax if interest accrued on the proceeds of the sale of the property and was paid to a non-resident beneficiary.
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 passed away and left a will, with probate granted.
The deceased purchased a property as joint tenants pre capital gains tax (CGT).
The deceased's will granted a right to occupy the property subject to certain conditions.
The dwelling was occupied as their main residence at all time under the occupation right, until they passed away on XX Month 20XX.
The property was not used for income producing purposes.
The property was placed on the market and sold with settlement occurring.
The proceeds from the sale of the property are to be divided amongst various beneficiaries in accordance with the will of the deceased.
Relevant legislative provisions
Income Tax Assessment Act 1997 subsection 118-195(1)
Income Tax Assessment Act 1997 section 885-10(1)(b)
Income Tax Assessment Act 1997 section 885-20