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Edited version of private advice
Authorisation Number: 1051953899661
Date of advice: 23 February 2022
Ruling
Subject: CGT and disposal of deceased main residence
Question
Does Section 118-195 of the Income Tax Assessment Act 1997 apply to disregard any capital gain on the sale of the Property?
Answer
Yes. Any capital gain made on the sale of the Property can be disregarded as the conditions under section 118-195 of the ITAA 1997 apply in this situation. Please refer to QC document 64895 on the ATO website for further information.
This ruling applies for the following periods:
Income year ending 30 June 20XX
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
The Taxpayer purchased the Property after 20 September 1985.
The purchase date was in 19XX, for an amount of $XXX,XXX, and the property was originally used to produce income.
The Taxpayer moved into the Property and it became and continued to be their main residence in 20XX.
The Property was the Taxpayer's main residence just before they passed away.
The Taxpayer passed away in 20XX.
The Property was not being used for the purposes of producing assessable income just before they passed away.
The Property passed to the Trustee of their estate.
The Property was sold in 20XX.
The Property was sold within 2 years of the Taxpayer passing.
The Property was not used to produce assessable income between the time the Taxpayer passed away and the sale of the Property.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 118-195