Private ruling: Commissioner's discretion - deceased estates
Date of advice: 27 March 2024
Published: 6 May 2024
Ruling period: Year ending 30 June 2024
Date scheme commenced: 1 July 2023

Ruling: Q1: Will the Commissioner exercise their discretion under subsection 152-80(3) of the Income Tax Assessment Act 1997 (ITAA 1997) to extend the time limit to allow any available small business capital gains tax concessions to be applied to the sale of an active asset? | A1: Yes. Having considered the relevant circumstances, particularly in relation to the delays caused by disputes over the estate and the COVID-19 restrictions, the Commissioner will exercise the discretion under subsection 152-80(3) of the ITAA 1997 to allow an extension of time.

Relevant facts and circumstances: The deceased traded as a primary producer. The land that the farm operated on was transferred under the deceased's will to their estate and continued to be used as primary production land. The executors of the deceased's will are their children, the deceased's partner and their child. Approximately six months after the deceased died communication broke down between the executors. Time was spent trying to communicate between the parties to decide what to do with the farm while trying to run the farm. Both parties needed to get independent advice from their own solicitors to complete a deed and settle the estate. COVID-19 restrictions made meeting more difficult as no one was able to meet in person. The properties were sold over 2 years after the deceased's death.

Relevant legislative provisions: Income Tax Assessment Act 1997 subsection 152-80(3)