Edited version of private advice

Authorisation Number: 1051925187327

Date of advice: 25 November 2021

Ruling

Subject: Capital gains tax

Question

Will the Commissioner exercise his discretion under section 118-195 of the Income Tax Assessment Act 1997 to extend the two-year period to dispose of the dwelling to the settlement date?

Answer

Yes. Having considered your circumstances and the relevant factors, the Commissioner will extend the two-year period to dispose of the dwelling. Further information about this discretion can be found by searching 'QC 66057' on ato.gov.au

This ruling applies for the following period:

Year ended 30 June 2021

The scheme commences on:

1 July 2020

Relevant facts and circumstances

The deceased died a few years ago.

The dwelling at the property was the deceased's main residence for the whole of their ownership period.

The deceased purchased the property several years ago.

The property was never used to produce assessable income.

The property was less than two hectares.

Probate was granted in the same year that the deceased passed away.

The property was transferred into your name and your siblings name in the following year.

Conversations with a real estate agent commenced and it was advertised for sale.

The reason why the property was sold outside the two year period was due to the property needing to be cleaned out to make it ready for sale.

You and your sibling needed to travel to do the clean-up, and you and your sibling do not live nearby.

In addition to this there were bushfires in the area and the roads were cut off for a period of time.

The pandemic also impacted the sale with the covid restrictions and the lock down of retirement facilities, the property was not able to be shown to potential purchasers for several months.

Settlement occurred more than two years after the date the deceased passed away.

Relevant legislative provisions

Income Tax Assessment Act 1997 section 118-195