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Edited version of private advice
Authorisation Number: 1052085048286
Date of advice: 7 February 2023
Ruling
Subject: Commissioner's discretion - deceased estate
Question
Will the Commissioner exercise his discretion under section 118-195 of the Income Tax Assessment Act 1997 (ITAA 1997) to extend the two-year period to dispose of the dwelling to XX XX 20XX?
Answer
Yes. Having considered your circumstances and the relevant factors, the Commissioner will extend the two-year period to dispose of the dwelling to XX XX 20XX. Further information about this discretion can be found by searching 'QC 66057' on ato.gov.au.
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.
The property was inherited by the deceased on XX XX 19XX.
The property was the deceased's main residence just prior to their death and never used to earn assessable income.
The property was less than 2 hectares.
Probate was granted on XX XX 20XX.
The reasons for the property being sold outside the 2-year time period were as follows:
• The deceased was a hoarder to the extent that the local council has fined the estate for a public safety risk.
• Broken plumbing was not able to be repaired due to the site being inaccessible.
• The front yard was not able to be cleared in a 5 week period by a team of 5 and the inside of the property was in a similar state.
• You were residing in a different state and the COVID restrictions reduced your ability to travel to State X to clean the property out and get it ready for sale.
• There was a delay in probate being granted due to a dispute between the beneficiaries.
• Probate took over 2 years to be granted due to the dispute.
The property was finally placed on the market, contracts for the sale of the property were signed on XX XX 20XX and settlement was XX XX 20XX.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 118-195