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Edited version of private advice
Authorisation Number: 1052020182265
Date of advice: 11 August 2022
Ruling
Subject: Commissioner's discretion - deceased estate
Question
Will the Commissioner exercise the discretion to allow an extension of time for you to dispose of your ownership interest in the property and disregard the capital gain or capital 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 and their late spouse purchased a property as tenants in common before 20 September 1985.
The deceased and their late spouse resided in the property as their main residence from the date of ownership until 20XX, where the deceased and their late spouse moved to an aged care facility.
Prior to the deceased and their late spouse passing away, they were under an administration order with a public trustee.
The deceased passed away and left a Will.
The terms of the deceased's Will state the deceased's ownership interest in the property was to be held on trust for the late spouse for their use and enjoyment.
The late spouse was entitled to any income the property derived and occupy the property until such a time either they passed away or did not abide by the conditions placed on the property under the terms of the Will.
The property was used to produce income for a period shortly after the deceased passed away. The property was then left vacant until sold.
The deceased's late spouse passed away approximately X years after the deceased passed away.
Delays were experienced by the executor in obtaining asset and liability information from the public trustee for the late spouse's estate due to restrictions put in place due to the COVID-19 pandemic. This delayed the application for a Grant of Probate for the late spouse's estate.
Probate for the late spouse's estate was granted approximately X months after the late spouse passed away.
Probate for the deceased's estate was granted approximately X years after the deceased passed away.
The executor attempted to obtain the certificate of title for the property from public trustee so relevant caveats could be removed.
The public trustee did not provide the certificate of title to the executor until X months after probate was granted for the deceased's estate due to administration issues caused by COVID-19 pandemic restrictions placed in XXXX.
The property was sold and settled.
The property was situated on less than X hectares.
No capital improvements were made to the property prior to the sale of the property.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 104-10
Income Tax Assessment Act 1997 section 118-195