Edited version of private advice

Authorisation Number: 1051996737073

Date of advice: 21 June 2022

Ruling

Subject: Commissioner's discretion - deceased estate

Question

Will the Commissioner exercise his discretion under section 118-195 of the Income Tax Assessment Act 1997 (ITAA 197) to extend the two-year period to dispose of the dwelling?

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 ending 30 June 20XX

The scheme commences on:

1 July 20XX

Relevant facts and circumstances

The deceased died a few years ago.

The property was purchased by the deceased prior to 1985.

The property was the deceased's main residence for the whole of is ownership period.

The property was never used to produce income.

The property was less than 2 hectares.

The property remained vacant after the deceased's death until it was sold.

Probate was granted in the year after the deceased died.

The property was placed on the market over two years later and settlement was approximately a month later.

The reasons for the property not being sold within the 2 year time period was due to the pandemic lock downs and your spouse having a serious illness.

The lock downs meant you were not able to clean the property out and prepare it for sale and it was difficult to advertise properties for sale where people were limited in their travel.

Your spouse was diagnosed with a serious illness and needed hospitalisation for treatment and then time to recover.

The property was placed on the market as soon as possible once restrictions were lifted and travel could commence.

Relevant legislative provisions

Income Tax Assessment Act 1997 section 118-195