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Edited version of private advice
Authorisation Number: 1052096600312
Date of advice: 14 March 2023
Ruling
Subject: Commissioner's discretion - deceased estate
Question
Will the Commissioner's discretion be exercised under subsection 152-80(3) of the Income Tax Assessment Act 1997 (ITAA 1997) to extend the two-year time limit to allow the small business capital gains tax (CGT) concessions in relation to the 50% interest in the Property?
Answer
Yes.
Having considered your circumstances and the relevant factors, the Commissioner will exercise the discretion under subsection 152-80(3) of the ITAA 1997 and allow an extension of the two-year period.It does not appear that there would be any prejudice to the Commissioner in allowing the extension. There would be no unsettling of people or unfairness to people in like positions or the wider public. There does not appear to be any mischief involved. It would be fair and equitable to allow an extension of time.
Further information on 'death and small business capital gains tax (CGT) concessions' can be found on our website by searching QC 52292.
Further information for you to consider
The private ruling has been limited to the question requested upon application which is whether the Commissioner can exercise discretion under subsection 152-80(3) of the ITAA 1997 to allow an extension of the two-year period. Therefore, the Commissioner has not considered whether the Deceased was in fact entitled to the small business CGT concessions. Further information on 'small business CGT concessions' can be found on our website by searching QC 22655.
This ruling applies for the following period:
Year ended 30 June 20XX
The scheme commenced on:
1 July 20XX
Relevant facts and circumstances
On DD MM YYYY, the Deceased passed away.
The Deceased owned 50% interest and Individual A owned 50% interest in the Property.
The Property was purchased as Tenants in Common.
The Deceased carried on a business on the Property as a sole trader up until their death.
The Deceased's Will stated that their interest in the Property was to be held by the executor of the Estate subject to the granting of a 'life occupancy' to Individual A for use of the Property.
Individual A and the executor of the Estate were in dispute in relation to the Property. Individual A filed a statement of claim with the Court in the 20XX-XX financial year.
In settlement of the dispute, the relevant parties entered into a Deed of Settlement and the Property was sold.
Individual A lived on the Property up until it was sold.
You have stated that the Deceased was a CGT small business entity.
The Deceased was over 55 years of age.
Relevant legislative provisions
Income Tax Assessment Act 1997 subsection 152-80(3)