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Edited version of private advice
Authorisation Number: 1051868501158
Date of advice: 20 July 2021
Ruling
Subject: Commissioner's discretion to extend the two-year time limit to dispose of an inherited house
Question
Will the Commissioner allow an extension of time to mid-2021 for you to dispose of your ownership interest in the house 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 2021
The scheme commenced on:
1 July 2020
Relevant facts and circumstances
At some time before 1985, the deceased bought the house.
In late 20XX, the deceased passed away intestate. Shortly after, the deceased's sibling provided instructions to their lawyer to administer the deceased's estate. Soon after, their lawyer also received a letter from the lawyer of the children of the deceased's other sibling indicating that they may apply for a Grant of Probate.
In early 20YY, the lawyer for the deceased's sibling advised the lawyer for the children of the deceased's other sibling that the deceased's sibling objected to them obtaining a Grant of Probate.
In late 20YY, the lawyer for the children of the deceased's other sibling advertised their intention to obtain a Grant of Probate. Shortly after, the lawyer of the deceased's sibling lodged a caveat with the Probate Office.
In late 20ZZ, all parties signed a Deed of Family Arrangement agreeing to the deceased's sibling making an application for a Grant of Letters of Administration of the deceased's estate.
In early 20XY, the deceased's sibling was granted Letters of Administration of the deceased's estate. Shortly after, the house was listed for sale and sold quickly.
In mid-20XY, the house settled. (Less than three years after the deceased passed away).
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