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Edited version of private advice
Authorisation Number: 1052384013109
Date of advice: 09 April 2025
Ruling
Subject: CGT - deceased estate
Question 1
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 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 on XX/XX/20XX.
The deceased acquired the property prior to 20 September 1985.
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.
On XX/XX/20XX, probate was granted.
The deceased's will contained a provision to permit Person A to reside in the property free of charge during their life in respect that they pay rates, taxes and other outgoings and maintain the property.
The property was occupied by Person A until XX/20XX, when they moved into an aged care facility.
Following Person A's move into the aged care facility, the property was then occupied by Person A's relative, Person B who moved into the property to maintain it whilst Person A was in the aged care facility. Person B lived in the property rent free until it was sold.
On XX/XX/20XX, you signed agency agreements to list the property for sale and the property was listed for sale on XX/XX/20XX.
Whilst Person A was in the aged care facility, they continued to pay for the utilities and household expenses until they passed away.
On XX/XX/20XX, Person A passed away.
Person B continued to reside in the property whilst the estate was being finalised.
Aside from general maintenance including lawn mowing and cleaning, there were no improvements done to the property.
You entered into a contract to sell the property on XX/XX/20XX with settlement occurring on XX/XX/20XX.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 118-195