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Edited version of private advice
Authorisation Number: 1051934687649
Date of advice: 16 December 2021
Ruling
Subject: Commissioner's discretion - 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 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 66057' 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 passed away on xx/xx/20xx.
The deceased and their partner (P) acquired the dwelling as a joint tenants prior to 20 September 1985.
The land on which the dwelling is located is less than X hectares.
The joint tenancy was severed after 20 September 1985 where the deceased and P commenced to hold the dwelling as tenants in common with a 50% share each.
The deceased's Will created a trust over their 50% interest in the dwelling for P for life with the remainder to benefit the deceased's three children, A, B & C.
The deceased's Will provided A with first option to purchase the deceased's 50% interest in the dwelling at market value when P's life interest ended.
P occupied the dwelling until xx/20xx when they moved to aged care.
The dwelling was never used for income producing purposes after P moved out.
The choice has been made to continue to treat the dwelling as P's main residence for CGT purposes for her period of occupancy at the aged care facility.
P passed away on xx/xx/20xx.
P's Will also provided A first option to purchase their 50% share of the dwelling.
A intends to exercise their rights under both Wills to purchase the dwelling.
There has been a delay in the disposal of the dwelling to A because of complications in the administration of P's estate that were outside of the executor's control.
Relevant legislative provisions
Income Tax Assessment Act 1997 subsection 118-145(1)
Income Tax Assessment Act 1997 subsection 118-145(3)
Income Tax Assessment Act 1997 subsection 118-195(1)