Edited version of private advice

Authorisation Number: 1051975240508

Date of advice: 29 April 2022

Ruling

Subject: CGT - deceased estate - Commissioners discretion to extend 2-year period

Question

Will the Commissioner allow an extension of time for you to dispose of your ownership interest in the dwelling located at the property) 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 ato.gov.au for 'QC 66057'.

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 in 20XX.

Probate was applied for in 20XX but not granted due to an unresolved issue regarding the testamentary capacity of the deceased at the time of creating the will.

Affidavits supporting the probate application were submitted in 20XX through to 20XX.

Probate was granted in 20XX.

The executor of the estate allowed time for the six-month statutory period that grants other parties to contest the will. This was done to ensure there were sufficient funds to cover any court proceedings and reduce the risk of litigation against the executor for failing to allow the statutory six-month period.

The deceased's child challenged the will with the Supreme Court in June 20XX. This occurred just before the six-month expiration period ended.

The court proceedings ended in mediation in 20XX.

The property was listed for sale by auction shortly after the court proceedings ended.

The property went under contract at auction in 20XX.

The property settled in 20XX.

Relevant legislative provisions

Income Tax Assessment Act 1997 section 118-195