Private ruling: Capital gains tax – deceased estate – Commissioner’s discretion to extend the two year period to dispose of an inherited dwelling
Date of advice: 3 April 2019
Published: May 2019
Ruling period: Year ending 30 June 2019 | Year ending 30 June 2018
Date scheme commenced: 1 July 2017

Ruling: Q1: Will the Commissioner exercise his discretion under subsection 118-195(1) of the Income Tax Assessment Act 1997 (ITAA 1997) and allow an extension of time to the two year period? | A1: Yes. Having considered your circumstances and the relevant factors, the Commissioner will allow an extension of time. Further information about this discretion can be found by searching 'QC 52250' on ato.gov.au

Relevant facts and circumstances: The deceased acquired a 50% interest in a property (the dwelling). The deceased’s sibling owned the other 50% interest and resided in the dwelling. The dwelling was the deceased’s main residence. The dwelling was not used to earn assessable income. Probate was granted XX months after the deceased’s death. The deceased’s partner was the executor of the estate. The sale of the dwelling was prolonged as the deceased’s sibling was not co-operating with having the dwelling listed and was then being difficult when negotiating a price. The executor threatened proceedings to have trustees for sale appointed and took steps to initiate this process. The dwelling was sold and settlement occurred two years and two months after the deceased’s death.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 104-10 | Income Tax Assessment Act 1997 subsection 118-130(3) | Income Tax Assessment Act 1997 section 118-195