Private ruling: Deceased Estate - 2 year discretion
Date of advice: 4 November 2025
Published: 22 December 2025
Ruling period: Year ending 30 June 20XX
Date scheme commenced: DDMMYY

Ruling: Q1: Will the Commissioner exercise his discretion under section 118-195 of the Income Tax Assessment Act 1997 to extend the period for Person A's estate to dispose of its ownership interest in the property? | A1: Yes. Having considered all your circumstances and the relevant factors the Commissioner will allow an extension of time. Person A passed away in YYYY, leaving their entire estate to Person B, who moved into the property and lived in it as their main residence until their death in YYYY. It was not discovered until after Person B's death that the property was never transferred into Person B's name and that Person A's estate was never fully administered. It is noted that Person B was on a disability support payment and suffering health issues which were likely factors in them neglecting to fully administer Person A's estate. Person B's adult children, Person C and Person D were granted letters of administration for both Person A's and Person B's estates. Title to the property is held by Person C and Person D as trustees of Person A's estate. They were not in a position to sell the property until after Person B passed away. The property was never used to produce income and will be disposed of within 2 years of Person B's death. Further information about the Commissioner's discretion can be found by searching ato.gov.au for 'QC 66057'

Relevant facts and circumstances: In YYYY, Person A purchased the property located at Address A. The property was Person A's main residence at the time of their death. Person A passed away on DDMMYY. The property is less than 2 hectares. The property was never used to produce income. Person A's Will named their adult child Person B as the sole executor and beneficiary. On Person A's death, Person B moved into the property and remained living in the property as their main residence until their death on DDMMYY. Person B never obtained probate for Person A's estate. Person B never transferred the property into their own name as either executor or beneficiary, so did not fully administer Person A's Estate. Person B suffered from significant health issues which were diagnosed in YYYY. Person B was on a disability support payment at the time of Person A's death. Person B passed away intestate and under intestacy laws their beneficiaries are their two children Person C and Person D. On DDMMYY, Person C and Person D were granted letters of administration for Person B's estate, and after this they found out that the property was never transferred into Person B's name and had to apply for letters of administration for Person A's estate. Person C has been residing in the property since Person B's death. On DDMMYY Person C and Person D were granted probate for Person A's Estate. Person C and Person D were then the trustees for Person A's estate and Person B's estate, and beneficiaries for Person B's estate. The property title was then transferred into their names as trustees of Person A's Estate. A Deed of Family Arrangement dated DDMMYY was prepared and this advises that Person C will essentially 'buy out' Person D's entitlement to the property by paying 50% of the value of the property. In return, the trustees of Person A's estate will transfer title to the property to Person C before DDMMYY.

Relevant legislative provisions: Income Tax Assessment Act 1997 Section 118-195