Edited version of private advice

Authorisation Number: 1052210556280

Date of advice: 11 January 2024

Ruling

Subject: Commissioner's discretion - inherited dwelling

Question

Will the Commissioner exercise the discretion under section 118-195 of Income Tax Assessment Act 1997 (ITAA 1997) to allow an extension of time for you to dispose of y our ownership interest in the dwelling and disregards 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 ended 30 June 20YY

The scheme commenced on:

1 July 2022

Relevant facts and circumstances

The deceased passed away on XX 20XX.

The deceased and their spouse acquired the property as joint owners before DD September YYYY.

The spouse passed away on XX 20XX and the deceased subsequently became the sole owner of the property on XX 20XX.

The property was the main residence of the deceased just before they passed away and was not used to produce assessable income at that time.

The deceased's Will, dated XX 20XX, provided that X and Y are the Executors and Trustees.

Probate was granted on XX 20XX.

The property has been the main residence for Y all their life until settlement occurred on XX 20XX.

From XX 20XX until XX 20XX, Y had significant health concerns.

Y was required to stay close to the hospital for treatment and management of their condition.

In XX 20XX, Y had a successful operation.

In XX 20XX, the real estate agents were engaged to sell the property.

The property was advertised for sale online on XX XX 20XX.

X and Y entered into a contract to sell the property on XX XX 20XX with settlement occurring on XX June 20XX.

Relevant legislative provisions

Income Tax Assessment Act 1997 subsection 118-195 (1)