Edited version of private advice

Authorisation Number: 1052016598528

Date of advice: 5 August 2022

Ruling

Subject: Commissioner's discretion - deceased estate

Question

Will the Commissioner use their discretion to allow an extension of the 2-year limit to 29 June 20XX for the capital gains tax (CGT) exemption on the sale of the inherited dwelling that was the main residence of the deceased?

Answer

Yes. Having considered the circumstances, relevant factors you have provided, and how soon after the 2-year limit the dwelling was sold; the Commissioner will exercise their discretion and allow an extension of the 2-year limit for an exemption from CGT on the disposal of an inherited property. Further information about this discretion can be found by searching 'QC 66055' on ato.gov.au.

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 died mid-20XX.

The dwelling is a post-CGT asset.

The dwelling was the main residence of the deceased at the time of death.

The dwelling was not used to produce income.

You are overseas residents.

At the time of decease, the border closures resulting from COVID-19 occurred.

You were not able to travel to Australia until the borders opened.

You were not able to get flights until early 20XX.

You needed to clean the interior and exterior of the dwelling to ready it for sale. You were not able to do this until you were able to enter Australia.

You wanted to inspect the premises yourself and sort through the effects as you knew the value of the effects and how they should be distributed.

The property was listed for sale mid-20XX.

The contract date for the dwelling was mid-20XX.

Settlement occurred soon after.

Relevant legislative provisions

Income Tax Assessment Act 1997 section 118-195