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Edited version of private advice
Authorisation Number: 1052169670093
Date of advice: 21 September 2023
Ruling
Subject: Commissioner's discretion - deceased estate
Question
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'.
This ruling applies for the following periods:
Year ended XX/XX/20XX
Year ended XX/XX/20XX
The scheme commenced on:
XX/XX/20XX
Relevant facts and circumstances
The Deceased passed away on XX/XX/20XX leaving a will.
As at date of death the Deceased owned a dwelling at XXX, which was their main residence.
The Deceased appointed Person A (beneficiary) and Person B (beneficiary) as the Executors of their Will. The Will stated the property was not to be sold until Person C (beneficiary) wished it to be.
Person A was residing at the property with the Deceased when they passed away and continued to do so for some years after.
Person A was granted probate on XX/XX/20XX, and Person B on XX/XX/20XX.
Person A and Person B's relationship became strained with most communication through lawyers. Person A sought to have Person B renounce their role as executor.
On XX/XX/20XX, Person C expressed it was their wish to now sell the Property.
On XX/XX/20XX, Person A commenced proceedings to remove Person as Executrix which led to the Supreme Court of NSW ultimately ordering on XX/XX/20XX that an independent Administrator be appointed to administer the Estate. This order stated that Person A and Person B's applications for probate be revoked, and that XXX be appointed as independent administrator (the Administrator).
On XX/XX/20XX, Letters of Administration pursuant to the Court Order were issued to the Administrator.
The Administrator acted promptly in placing the property on the market in XX/20XX, and it sold by contract dated XX/XX/20XX and settled on XX/XX/20XX.
The Property is less than 2 hectares in size.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 118-195