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Edited version of private advice
Authorisation Number: 1052163091634
Date of advice: 31 August 2023
Ruling
Subject: Commissioner's discretion - deceased estate
Question 1
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 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'.
Question 2
If no, please advise the capital gains implications.
We note you have withdrawn question 2.
This ruling applies for the following periods:
Year ended XX/XX/20XX
Year ending XX/XX/20XX
The scheme commenced on:
XX/XX/20XX
Relevant facts and circumstances
The Deceased passed away on XX/XX/20XX intestate.
As at date of death the Deceased owned a dwelling at XXX (the Property), which was their main residence.
The Deceased acquired the Property on XX/XX/20XX as sole owner.
The Deceased's spouse had been residing in the Property from the time the Deceased acquired it and continued to reside in the Property after the Deceased's passing.
On XX/XX/20XX, Letters of Administration were granted to State Trustees Limited (Administrators).
The Deceased's spouse is the sole beneficiary of the Deceased's estate.
On XX/XX/20XX, the Deceased's spouse passes away, and the Administrator's begin discussions to have the Property cleared.
The Property is cleared and cleaned in a timely manner, and the Administrator's engage a real estate agent.
On XX/XX/20XX the Property is listed for sale. A contract is entered into to sell the Property on XX/XX/20XX, with settlement occurring on XX/XX/20XX.
At all material times, the Property was not used for producing assessable income.
The property is less than 2 hectares in size.
No capital improvements have been undertaken on the property after the death of the Deceased.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 118-195