Edited version of private advice

Authorisation Number: 1052043712530

Date of advice: 11 October 2022

Ruling

Subject: Commissioner's discretion - deceased estate

Question

Will the Commissioner exercise his discretion under subsection 152-80(3) of the Income Tax Assessment Act 1997 (ITAA 1997) extending the time limit to allow the small business capital gains tax (CGT) concessions to be applied in relation to the CGT asset?

Answer

Yes.

Having considered your circumstances and relevant factors, the Commissioner is able to exercise discretion under subsection 152-80(3) of the ITAA 1997 allowing a short extension of the two-year period.

Further information on 'death and small business capital gains tax (CGT) concessions' can be found on our website by searching QC 52292.

This ruling applies for the following period:

Income year ending 30 June 20XX

The scheme commences on:

1 July 20XX

Relevant facts and circumstances

Individual A and Individual B jointly owned the CGT asset which transferred to Individual A upon Individual B's death.

Individual A subsequently passed away a short time later.

Due to Individual A and B both passing away within a short period of time and the numerous assets involved the estates have taken a significant amount of time to administer.

A contract to dispose of the CGT asset was recently entered slightly outside the two-year time limit under paragraph 152-80(1)(d) of the ITAA 1997.

Individual A would have been entitled to reduce or disregard the capital gain under Division 152 of the ITAA 1997 if a CGT event had happened in relation to the CGT asset immediately before their death.

Relevant legislative provisions

Income Tax Assessment Act Division 152

Income Tax Assessment Act paragraph 152-80(1)(d)

Income Tax Assessment Act subsection 152-80(3)