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Edited version of private advice
Authorisation Number: 1052087925048
Date of advice: 22 February 2023
Ruling
Subject: Commissioner's discretion - deceased estates
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 the ownership interest in the property you owned as trustee of the deceased estate 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:
The income year ending 30 June 20YY
The scheme commenced on:
1 July 20YY
Relevant facts and circumstances
The deceased passed away on DD MM YYYY.
The deceased jointly acquired the dwelling on the property (the property) with their spouse after 20 September 1985.
The property was the main residence of the deceased just before they passed away and was not used to produce assessable income at that time.
The property was situated on less than two hectares of land.
The deceased's spouse passed away before the deceased and the deceased acquired their ownership interest in the property by survivorship.
The deceased's will was contested by a non-beneficiary, resulting in legal proceedings that persisted for a number of years.
Letters of administration were subsequently granted.
Following the appointment of an administrator, an application that further provision be made from the deceased's estate was made by the non-beneficiary and subsequently withdrawn.
The property was listed for sale soon after the grant of letters of administration.
The first contract for sale of the property fell through.
A second contract for sale of the property was executed, with settlement occurring on DD MM YYYY.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 118-195