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Edited version of private advice
Authorisation Number: 1052027481876
Date of advice: 2 September 2022
Ruling
Subject: Capital gains tax
Question
Will the Commissioner exercise his discretion under section 118-195 of the Income Tax Assessment Act 1997 (ITAA 1997) to allow an extension of time for you to dispose of your ownership interest in the dwelling and disregard the capital gain you make on the disposal?
Answer
Yes. Having considered your circumstances and the relevant factors, the Commissioner will allow an extension of time. Further information about this discretion can be found by searching 'QC 52250' on ato.gov.au
This ruling applies for the following period:
Year ended 30 June 2022
The scheme commences on:
1 July 2021
Relevant facts and circumstances
The deceased died several years ago.
Probate was granted a few weeks later.
The Property was the main residence of the deceased.
The Property was not used to produce income.
You are the full-time carer for your parent.
You live in a different state than the one where The Property is located.
Due to the care you provide to your parent you had additional difficulties attending to The Property.
You visited The Property in a year after Probate was granted, however the visit was cut short due to bushfires which required evacuation of various areas including where your accommodation was located.
Because of your duties as a carer you had problems dealing with The Property by yourself, so you arranged for your sibling living overseas to travel to Australia to help with The Property.
Due to the emerging covid pandemic it was decided to temporarily delay the visit of your sibling as they may catch covid and pass it onto your parent and also your sibling was concerned they may catch covid as they are immunocompromised.
The Australian national and state borders were subsequently closed and your sibling was no longer able to travel to Australia to help you.
The state borders and various restrictions remained in place until late in the following year, during which time you were unable to attend to The Property.
During the lockdown period you parent had additional serious health issues that you had to attend to.
Your parent's doctor has advised you that due to their condition they should remain at home due to the ongoing risk of covid.
Early in the relevant year you contacted a third party living near The Property who agreed to help you by clearing The Property of the deceased's remaining belonging and selling The Property.
The Property was sold a few months later and settlement occurred in the following month.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 118-195