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Edited version of private advice
Authorisation Number: 1052005414637
Date of advice: 18 July 2022
Ruling
Subject: CGT - deceased estate
Question
Will the Commissioner allow an extension of time for you to dispose of your ownership interest in 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:
xx/xx/20xx
Relevant facts and circumstances
The deceased passed away on xx/xx/20xx.
The deceased acquired the property after 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.
The property is less than two hectares in size.
Probate was granted to the executor on xx/xx/20xx.
There was a dispute regarding the will of the deceased.
In settlement, discharge, and satisfaction of any present, proposed or future family provision claim against the estate under the Succession Act 2006 (NSW) a Deed of Family Arrangement (Deed) was entered into on xx/xx/20xx between the executor and beneficiaries of the deceased's estate.
Under the Deed, one of the deceased's children (Beneficiary A), had a right of residence in the property for the remainder of their life.
Beneficiary A continued to live in the property under the right of residence until they passed away on xx/xx/20xx.
On xx/xx/20xx, the executor was admitted to hospital with acute confusion and delirium. The executor was later diagnosed with an illness that prevented the executor from administering the estate.
On or about xx/xx/20xx, medical advice was received that the executor's illness had left them with cognitive deficits that significantly impacted their ability to manage the activities of daily living.
On xx/xx/20xx, the Supreme Court of NSW ordered that the grant of probate to the executor be revoked, and on xx/xx/20xx, letters of administration were granted to the administrator.
The property was listed for sale soon after the letters of administration were granted. You entered into a contract to sell the property on xx/xx/20xx with settlement occurring on xx/xx/20xx.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 118-195