| 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: 1051850176449
Date of advice: 25 June 2021
Ruling
Subject:Commissioner's discretion to extend the two year period to dispose of an inherited dwelling
Question
Will the Commissioner exercise his discretion under subsection 118-195(1) of the Income Tax Assessment Act 1997 (ITAA 1997) and allow an extension of time to the two year period to dispose of an inherited dwelling?
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 20XX
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
The Deceased owned a property which was acquired before 20 September 1985 (the Property).
The Property consisted of X individual dwellings, with each dwelling being tenanted.
The Deceased passed away sometime after 20 September 1985.
Probate was granted X months after the Deceased's death.
The Property was listed for sale with the entire site being sold together.
Given the unique nature of the Property for the local market, there were very few comparable sales to use when pricing. It was initially priced based on older like sales and market growth in the area. Due to this, it was agreed that the timeframe for selling the property would likely be 6-12 months.
A more extensive marketing campaign was implemented for the Property and was indicative of its unique nature. The marketing of this Property remained online throughout the entirety of the campaign until sold and included:
• Photography of the site including additional drone shots taken
• A listing on realestate.com, domain.com and Xxxxx.com
• Large photo/For Sale board placed on site
• A video produced for social media of the Property, and
• A local print advertisement being placed in newspapers and magazines.
During the campaign and prior to Covid-19, the price was also adjusted and reduced to entice more interest. This strategy did result in more enquiries.
Other aspects of the Property which made selling it challenging were:
• Co-ordinating with X individual tenants to show the entire Property at one time
• Co-ordinating with X different property managers during the campaign
• Showing the tenanted dwellings in various states of presentation.
Due to the impact of Covid-19, interest in the local property market was low.
The Property was sold with settlement occurring X and a half years after the Deceased's death.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 118-195