Edited version of private advice

Authorisation Number: 1052083852231

Date of advice: 3 February 2023

Ruling

Subject: Commissioner's discretion - deceased estate

Question

Will the Commissioner exercise the discretion under section 118-195 of the Income Tax Assessment Act 1997 to allow an extension of time for you to dispose of your ownership interest in the dwelling 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 ending 30 June 20XX

The scheme commenced on:

1 July 20XX

Relevant facts and circumstances

The deceased passed away on XX/XX/20XX.

At date of death, the deceased owned a property. The property was the deceased's main residence and was not income producing at that time.

The property is situated on less than 2 hectares of land.

A number of factors contributed to a delay in the sale of the property including:

•         Shortly after the deceased's death, the council demanded emergency maintenance work be carried out to part of the property near the property boundary as it was deemed a public hazard.

•         Mediation was required after one of the beneficiaries instigated a legal proceeding as they believed they were not adequately provided for under the terms of the will.

•         After the deceased passed away, a major storm impacted the property.

•         The original real estate agent was diagnosed with a serious illness and subsequently passed away.

The property was not used for income producing purposes by the estate.

Approximately 2 years and 9 months after the deceased's death, the sale of the property was settled.

Relevant legislative provisions

Income Tax Assessment Act 1997 section 118-195