Private ruling: Two year exemption from capital gains tax for a deceased main residence.
Date of advice: 7 March 2019
Published: May 2019
Ruling period: 1 July 2015 to 30 June 2018

Ruling: Q1: Will the Commissioner exercise the discretion under 118-195(1) of the Income Tax Assessment Act 1997 (ITAA 1997) and allow an extension of time to the two year period? | A1: Yes. Having considered your circumstances and the relevant factors, the Commissioner will allow an extension of time. Further information about this discretion can be found by searching 'QC 52250' on ato.gov.au

Relevant facts and circumstances: The deceased’s last will appointed the children as executor’s of the will. The residue of the estate was split into 30 percent shares between the children. The last 10 percent was split equally between the grandchildren. The deceased resided in their main residence until they passed; the property was never used for investment purposes. Due to a dispute between the beneficiaries, the process of listing the house on the market for sale was delayed. The house was actively marketed and the contract for sale was signed within the two year period. Settlement failed to meet the two year period by only two months.

Relevant legislative provisions: Income Tax Assessment Act 1997 Subdivision 115-A | Income Tax Assessment Act 1997 section 102-20 | Income Tax Assessment Act 1997 section 118-195 | Income Tax Assessment Act 1997 section 104-10