Private ruling: CGT - 2-year discretion
Date of advice: 21 May 2026
Published: 3 August 2026
Ruling period: Year ending XX XXXXX 20XX
Date scheme commenced: XX XXXXX 20XX

Ruling: Q1: Will any Capital Gain Tax (CGT) you make be disregarded upon the sale of the Property, in accordance with section 118-195 of the Income Tax Assessment Act 1997 (ITAA 1997)? | A1: Yes. Having considered your circumstances and the relevant factors the CGT made on the sale of the property to be disregarded. As the spouse had the Right to Occupy stipulated in the Will by the deceased the Absence Rule 118-145 of ITAA 1997 is available for the period after the spouse ceased living in the property until settlement of the property.

Relevant facts and circumstances: The deceased passed away. The dwelling is located at the Property. The property is less than X. The property was purchased prior to DD MM 19YY . The property was originally purchased by the deceased and Spouse A, as joint tenants. The deceased's Spouse A passed away. The property automatically passed to the deceased by right of survivorship, with the deceased becoming the sole owner at that time. The Last Will and Testament was completed and signed by the Deceased. The Will named the deceased's Child A and Child B-in-law, as the Executors of the Will and Trustees of the Estate. Under the Will the Deceased granted Spouse B with a Right to Occupy/Life Tenancy, entitling them to live in the property as their main residence. For a period of time, Spouse B resided in the property as their main residence under the Right to Occupy specified in the Will of the deceased. The Grant of Probate was completed. It is noted that the spelling of the deceased name is slightly different in the Probate to the Will. The property formally passed to the Executor under the Will. Spouse B left the property No rental income has been derived from the property throughout the period of the right to occupy or since the departure of the spouse. A local real estate agent inspected the property and provided verbal recommendations regarding works required to prepare the property for sale. Due to the client's age, communication with the agent were conducted verbally. The works were not completed to improve or maximise the sale price. They were necessary to make the property saleable and facilitate a sale in a reasonable timeframe. The Executor arranged repairs and maintenance to prepare the property for sale, they obtained quotes and undertook necessary works and consulted with a real estate agent regarding the sale of the property. A real estate agent was appointed for the sale of the property. The Contract of Sale was executed. The property settlement occurred. Sometime after settlement, Spouse B passed away.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 118-195 | Income Tax Assessment Act 1997 section 149-10 | Income Tax Assessment Act 1997 section 118-145