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Edited version of private advice
Authorisation Number: 1052126013254
Date of advice: 2 June 2023
Ruling
Subject: Commissioner's discretion - deceased estate
Question
Will the Commissioner exercise the discretion under section 118-195 of ITAA 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 2023
The scheme commenced on:
1 July 2022
Relevant facts and circumstances
The deceased acquired their ownership interest in the property in April 19XX.
The deceased died in November 19XX.
The property was the deceased's main residence just before their death.
The property was not used for the purpose of producing assessable income at the time of the deceased's death.
The property was less than 2 hectares in size.
The executor was the deceased's child (the child) who had a right to reside under the deceased's will for the period of his lifetime.
The child did not obtain probate to the estate. However, the child did transfer the title to their name as personal representative.
The child lived in the property as per the right to reside clause of the deceased's will until their death in April 20XX.
Upon the child's death, the property reverted back to the deceased's estate and remained vacant while the Public Trustee organised probate, clearing and sale of the property.
The Public Trustee was granted an Order to Administer in September 20XX.
In November 20XX, the Public Trustee sent a transmission application to the titles office to register itself as personal representative.
In March 20XX, the property was auctioned and the sale contract was signed.
Settlement occurred in March 20XX.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 118-195