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Edited version of private advice
Authorisation Number: 1052217269722
Date of advice: 2 February 2024
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:
Financial year ending 30 June 20XX
The scheme commenced on:
XX/MM/CCYY
Relevant facts and circumstances
The deceased passed away on XX/MM/CCYY.
The deceased's estate contained a dwelling located in Australia (the property).
The deceased acquired the property before DD MM YYYY.
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 property was situated on less than two hectares of land.
Probate was granted around six months after the deceased's date of death.
The Executor has a life threatening disease. This disease has caused them to be admitted to hospital a few times in the past few years with complications.
The Executor has legal guardianship of minors with high caretaking needs.
The dwelling was broken into on two occasions and ransacked. This allowed rats to enter the dwelling.
Due to heavy rainfall and flooding, the roof leaked which caused mould to develop in the dwelling which had to be removed.
A pest inspector found white ants and the house had to be fumigated.
A contract to sell the property was executed around 4 and a half years after the deceased's death with settlement occurring around six weeks later.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 118-195