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Edited version of private advice
Authorisation Number: 1052103321553
Date of advice: 5 April 2023
Ruling
Subject: Commissioner's discretion - section 99A(2)
Question
Will the Commissioner exercise his discretion under subsection 99A(2) of the Income Tax Assessment Act 1936 (ITAA 1936) to apply progressive individual rates of tax as per section 99 of the ITAA 1936?
Answer
Yes.
This ruling applies for the following periods:
Income Year ended 30 June 20YY
Income Year ending 30 June 20YY
The scheme commenced on:
DD MM YYYY
Relevant facts and circumstances
The deceased passed away on DD MM YYYY leaving a Will (the Will).
Probate was granted to the Executrix on DD MM YYYY.
The Will established the Trust (the Trust) to hold the residue of the estate and apply the proceeds from the residue to liabilities of the Estate, then distribute the balance to the beneficiaries.
The administration of the Trust was delayed due to the following factors:
1. A beneficiary of the Trust indicated an intention to lodge a Testator Family Maintenance claim and requested time to prepare this. The Executrix paused dealing with the assets until the expiry of the agreed limitation period for the claim.
2. A major weather event causing damage to the Trust's main asset. It took many months to restore the damage to this asset.
3. A beneficiary of the Trust indicated a desire to replace the Executrix as the executor of the Estate. This ultimately did not transpire.
4. Government imposed lockdowns and restrictions in response to COVID hindered the Executrix's ability to procure property valuations, engage tradespersons, undertake works and repairs at the regional property, and work with the representatives or advisors for the Trust.
At no time has any person transferred or lent any property or money into the Trust and no rights or privileges have been attached to or conferred on or in relation to the Trust property.
Relevant legislative provisions
Income Tax Assessment Act 1936 section 99
Income Tax Assessment Act 1936 subsection 99A(2)