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Edited version of private advice
Authorisation Number: 1052036749007
Date of advice: 21 September 2022
Ruling
Subject: CGT - deceased estate
Question
Is any capital gains tax payable on transfer of the property from the testamentary trust to the beneficiaries?
Answer
No.
Based on the information provided to the Commissioner there will be no capital gains tax payable when the property is transferred out of the testamentary trust to the 3 beneficiaries.
Subsection 128-15(3) of the Income Tax Assessment Act 1997 (ITAA 1997) states any capital gain or capital loss the legal personal representative makes if the asset passes to a beneficiary in your estate is disregarded.
A legal personal representative includes an executor or administrator of an estate of an individual who has died.
The trustee of a testamentary trust is treated in the same manner as the trustee of a deceased estate or LPR for the purposes of applying Division 128.
This ruling applies for the following period:
Year ending 30 June 20XX
The scheme commenced on:
1 July 20XX
Relevant facts and circumstances
The deceased died on XX XXXX 20XX.
Probate was granted on X XXXXX 20XX.
There were X beneficiaries to the estate.
All of the assets were placed into a testamentary trust until X of the beneficiaries reached the age of XX as per the will.
All beneficiaries have met the age requirement under the will.
The property forms part of the testamentary trust.
The property will be transferred to each of the X beneficiaries.
Relevant legislative provisions
Income Tax Assessment Act 1997 Subsection 128-15(3)