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Edited version of private advice
Authorisation Number: 1051988758715
Date of advice: 1 June 2022
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 pursuant to section 118-195 of the Income Tax Assessment Act 1997?
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:
Income year 1 July 20XX - 30 June 20XX
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
The deceased passed away in Spring 20XX.
The deceased acquired the property before 20 September 1985.
The property was the main residence of the deceased throughout their ownership period.
The property has never been used to produce assessable income.
Probate was granted in Autumn 20XX.
Following the grant of probate, the executors of the estate then began the process of cleaning the property.
The COVID 19 lockdowns in Melbourne then commenced.
The executors were not living within the 5km radius to travel to the property, and they agreed when able to they would sell the property in early 20XX.
The child of one of the executors has a disability and she was required to undergo major surgery in early 20XX and have a further 3 months recovering at home.
The property was listed for sale in Autumn 20XX.
The executors entered into a contract to sell the property in Winter 20XX with settlement scheduled for Spring 20XX.
However, the purchaser was unable to complete settlement on that date due to issues with their financier, who was not prepared to settle due to an unregistered adverse possession dealing on the title (lodged in early 20XX). Following resolution of this matter, settlement subsequently occurred in Spring 20XX.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 118-195