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Edited version of private advice
Authorisation Number: 1051849580026
Date of advice: 11 June 2021
Ruling
Subject: Capital gains tax - deceased estate
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 is able to apply his discretion for up to two hectares of land with your dwelling under subsection 118-195(1) of the ITAA 1997 and 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
The deceased acquired a dwelling (the dwelling).
The dwelling is located on land that is less than two hectares.
The dwelling was the deceased's main residence when the passed away in 20XX.
The deceased left a number of wills at the time of their passing. The last will was prepared prior to the deceased being subject to a determination that they lacked capacity to manage their affairs.
A beneficiary named in the first will of the deceased, (person A) was not named as a beneficiary in the second will.
A dispute ensued between the beneficiaries some of whom resided overseas.
Person A indicated that they intended to challenge the validity of the latter will due to the deceased lacking the capacity required.
An agreement was reached between the beneficiaries which prevented the requirement for litigation.
The first executor, person B passed away during the administration of the estate which caused some delays as the replacement executor was required to apply for second grant of probate which was granted after some time.
The dwelling was listed for sale on in early 20XX
The dwelling was listed for sale by auction a short time later.
Settlement occurred after a period of time.
Relevant legislative provisions
Income Tax Assessment Act 1997 Subdivision 115-A
Income Tax Assessment Act 1997 section 102-20
Income Tax Assessment Act 1997 section 104-10
Income Tax Assessment Act 1997 section 118-120
Income Tax Assessment Act 1997 section 118-130
Income Tax Assessment Act 1997 section 118-195