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Edited version of private advice
Authorisation Number: 1052160646635
Date of advice: 30 August 2023
Ruling
Subject: Commissioner's discretion - deceased estate
Question
Will the Commissioner use their discretion to extend the two‐year time period in section 118‐195 of the Income Tax Assessment Act 1997 and disregard any capital gains made on the disposal of the property for the deceased's estate?
Answer
Yes.
Having considered your circumstances and the relevant factors the Commissioner will allow an extension of time. Further information about the Commissioners discretion can be found by searching ato.gov.au for 'QC 66057'.
This ruling applies for the following period
Yearended XX XXX 20XX
The scheme commences on:
XX XXX 20XX
Relevant facts and circumstances
The deceased passed away intestate on XX 20XX
The property was acquired by the deceased pre-CGT.
The deceased owned the property as tenants in common along with their spouse and other relatives.
The property is less than 2 hectares in size.
The property has not been used to produce income before or after the deceased's passing.
The deceased had considered the property as their main residence.
The spouse continued residing at the property.
After the deceased passed away letters of administration were granted to the Trustee on XX XXX 20XX.
Intestacy laws at the time determined the that the spouse would be the sole beneficiary of the deceased's estate.
Complete transfer of the deceased's ownership interest to the spouse was not done at the time of deceased's passing.
It was determined it would not be suitable to transfer it at the time due to the funds the spouse would need to pay into the deceased estate.
The spouse passed away on XX XXX 20XX.
Grant of Probate for the estate of the spouse was granted on XX XXX 20XX.
The Executor of the spouse's estate decided to sell the property.
The property required cleaning and removal of personal effects of the deceased's spouse.
Property was sold with settlement occurring on XX XXX 20XX, less than a year after the death of the deceased's spouse.
No capital improvements were made on the property.
Assumption
The deceased's estate had an ownership interest in the property at the time of disposal.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 118-195