Edited version of private advice

Authorisation Number: 1052362819214

Date of advice: 17 February 2025

Ruling

Subject: Commissioner's discretion - deceased estate

Question

Will the Commissioner exercise the discretion under section 118-195 of 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 'QC66057'.

This ruling applies for the following period:

Year ending XX 20XX

The scheme commenced on:

XX 20XX

Relevant facts and circumstances

The deceased passed away between XX 20XX to XX 20XX.

The property was less than 2 hectares of land.

The deceased acquired the property after 20 September 1985.

The property was the main residence of the deceased until the date of death and was not used to produce assessable income at any time.

The deceased has no family or relatives in Australia.

Following the deceased's death, the family in Country X learned of the deceased's passing in XX 20XX.

The Will, dated XX 20XX, appointed a company Y as the executor and trustee of the deceased estate.

XX 20XX, the deceased's family in Country X organised appointment at the Australian Embassy to sign the declaration to appoint you, a deceased's relative, as the representative of the beneficiaries.

XX 20XX, company Y renounced its right to probate.

XX 20XX, the declaration was signed and you contacted the lawyer to locate the Will and apply for probate.

XX 20XX, you applied for a grant of probate.

XX 20XX, the probate was granted to you as the executor of the decease estate.

XX 20XX, you arrived in Australia for only few weeks. During this time, you managed to organise the funeral, clean the property, pay bills and search for necessary documents to proceed, including bank account, superannuation and other relevant document.

From this visit, you were also discussing with a neighbour who had expressed interest in purchasing the property.

XX 20XX, you returned to Australia with one of the beneficiaries to get the property ready for sale.

XX 202XX, the neighbour ultimately refused the offer, as it was beyond their financial capacity. So, you decided to contact a real estate agent to dispose the property.

The property was sold on XX 20XX and the settlement occurred on the following month.

Relevant legislative provisions

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