Edited version of private advice

Authorisation Number: 1052369882455

Date of advice: 06 March 2025

Ruling

Subject: Capital gains tax

Question 1

Will the Commissioner exercise the discretion under section 118-195 of the Income Tax Assessment Act 1997 (ITAA 1997) to allow an extension of time to dispose of the ownership interest in the property and disregard the capital gain made on the disposal?

Answer 1

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 ending 30 June 20XX

The scheme commenced on:

1 July 20XX

Relevant facts and circumstances

The deceased passed away a number of X ago.

The deceased lived at the property.

The property was owned solely by the deceased after the deceased and their spouse divorced.

The property was the deceased main residence just before they passed away.

The property was less than X hectares in size.

The property was never used to derive assessable income before the deceased passed or after they passed.

At the time of the deceased's death, they were residing alone and did not have a will.

Letters of administration were recently granted to the Public Trustee.

The deceased's intestacy was not known until their child, Individual Z, passed away a couple of years ago and it was found that the property was still in the deceased's name.

The deceased had multiple children.

The reason for the delay in selling the property was due to one of the deceased's children, Individual Z, living in the property until their death.

Individual Z lived in a rental property around the corner from their family home where their parent lived.

Individual Z intended on moving into the family home with the deceased to care for them, but the deceased passed away before they could move in.

The reason for them intending on moving in with their parent was to care for the parent and to share the expenses as Individual Z was suffering financial hardship.

Prior to the deceased passing, Individual Z would assist their parent with mowing the lawns on a ride on mower and doing shopping.

Individual Z moved into the property after their parent passed away with the assistance of a sibling.

Individual Z paid all the running costs associated with the property and maintained the property up until their death along with doing some repairs and paying a council clean-up bill.

Individual Z commenced the huge job of cleaning up the property due to the deceased being a hoarder.

Individual Z was on a Centrelink Disability Support Pension.

Individual Z had a number of acute and severe medical conditions.

Individual Z was heavily dependent on others to assist them and get around.

Individual Z felt safe in the family home which they were raised in, enjoyed the familiarity of the home as well as the area.

The property is located close to a hospital where Individual Z attended frequently for treatment.

Individual Z's health continued to deteriorate and thus the idea of finding a rental and moving out of the family home quickly became an impossibility.

The property was vacant from Individual Z's death until it was sold.

The contract for the sale of the property was signed and settlement occurred a few months ago.

Relevant legislative provisions

Income Tax Assessment Act 1997 section 118-195