Private ruling: Extension of the main residence exemption for a beneficiary of a deceased estate
Date of advice: 20 August 2018
Published: October 2018
Ruling period: Year ended 30 June 2015 | Year ended 30 June 2016 | Year ended 30 June 2017
Date scheme commenced: 1 July 2014

Ruling: Q1: Will the Commissioner exercise his discretion to extend the two year exemption period under subsection 118-195(1) of the Income Tax Assessment Act 1997 (ITAA 1997)? | A1: Yes. Having considered your circumstances and the relevant factors, the Commissioner is able to apply his discretion under subsection 118-195(1) of the ITAA 1997 and allow an extension of time. Further information on the relevant factors and inheriting a dwelling generally can be found on our website ato.gov.au and entering Quick Code QC52250 into the search bar at the top right of the page.

Relevant facts and circumstances: The deceased passed away leaving behind a parcel of land that they acquired before 20 September 1985. Shortly after the deceased’s death, in anticipation of a formal transfer of the property, you instructed a licenced conveyancer to prepare a contract for sale and begin planning a sales advertisement program in order to sell the property. The conveyancer conducted some property searches which revealed that the land had recently been rezoned. You received numerous offers but they all fell through when the potential purchasers learnt of the zoning. You engaged with the local council to query whether the property would be compulsorily acquired. The council agreed to purchase the property and settlement occurred more than two years after the deceased’s death.

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