Private ruling: Capital gains tax - deceased estate - disposal
Published: October 2012
Ruling period: Year ended 30 June 2013
Date scheme commenced: 1 July 2012

Ruling: Q1: Is the capital gain or capital loss made on the sale of your 50% interest in your parent's home to your sibling disregarded? | A1: Yes.


Relevant legislative provisions: Income Tax Assessment Act 1997 Section 118-195 | Income Tax Assessment Act 1997 Section 128-15

Reasons for decision: Summary: Capital gains tax (CGT) is the tax you pay on certain gains you make. You may make a capital gain or a capital loss as a result of a CGT event. The most common event happens if you dispose of an asset to another entity, for example if you sell your interest in a property. In your situation the sale of your interest in the dwelling constitutes CGT event A1. Any capital gain or capital loss you make from a CGT event that happens in relation to a dwelling is disregarded if the deceased acquired the dwelling before 20 September 1985 and you disposed of your ownership interest within two years of the person's death. As the property will be disposed of within the two years from date of death, any capital gain or capital loss realised on your interest in the dwelling will not be assessable.

Please check this edited version to be sure that there are no details remaining that you think may allow you to be identified. If you have any concerns about this ruling you wish to discuss, you will find our contact details in the fact sheet. | Relevant facts: You and your sibling are joint executors and beneficiaries as tenants in common of the estate of your late parent. | You have provided a copy of the will of your late parent which forms part of and should be read in conjunction with this private ruling. | The property will be transferred by the estate to you and your sibling. | Then your half share of your late parent's house will be transferred by you to your sibling within two years of the date of death of your parent. | The shares owned by your parent prior to death will be transferred in an off market transfer to your self managed superannuation fund.