Private ruling: Commissioner's discretion - extension of time
Date of advice: 23 January 2026
Published: 16 March 2026
Ruling period: Year ended 30 June 20YY
Date scheme commenced: DD MM 20YY

Ruling: Q1: Will the Commissioner exercise the discretion under section 118-195 of the Income Tax Assessment Act 1997 to allow an extension of time for you to dispose of your ownership interest in the dwelling and disregard the capital gain or capital loss you made on the disposal? | A1: Yes. Having considered your circumstances and the relevant factors the Commissioner will allow an extension of time under section 118-195 of the Income Tax Assessment Act 1997 . Further information about the Commissioner's discretion can be found by searching ato.gov.au for 'QC 66057'.

Relevant facts and circumstances: In 19YY, the deceased purchased the property with their late spouse from the executor's grandparents. They owned the property as joint tenants, and it was their main residence until each of their passing. The property's land area is less than 2 hectares. After their spouses passing, the deceased continued to use the property as their main residence. On DD MM 20YY, the deceased passed away. A copy of the will was supplied, within the will one of the deceased's children was appointed executor. The will also stipulated that the deceased's two children are the beneficiaries of the property. In MM 20YY, the executor retained a legal representative for the estate to apply for a grant of probate. In MM 20YY, the executor and their family were cleaning up the property to put it on the market. However, one of the beneficiaries moved into the property without the executor's consent. In MM 20YY, the estate consulted a real estate agent in relation to a rental appraisal for the property. On DD MM 20YY, probate was granted. On DD MM 20YY, the estate entered into a Residential Tenancy Agreement with the beneficiary who had taken up residency in the property without consent as they had nowhere else to live. The executor signed a lease agreement through a solicitor with the beneficiary to rent the property for $XX per week. In MM 20YY, the time for the beneficiary to make a family provision claim expired. From DD MM 20YY to DD MM 20YY, the beneficiary paid weekly rent. After this date, they began paying sporadically for XX further payments, and then stopped paying any rent at all after DD MM 20YY. The executor had been advised not to distribute the proceedings from the estate until such time that beneficiary's family provision claim expired (one year from date of death). On DD MM 20YY, the executor served an eviction notice on the beneficiary to move out of the property. From DD MM 20YY to DD MM 20YY, there was an ongoing dispute between the beneficiary and the estate to vacate the property. On vacating the property, the beneficiary left the house in a state that was unliveable and unsellable. This brought on a second legal dispute. The beneficiary refused to be involved in the second clean-up which was left to the executor and their family. Photographs were supplied of the state of the property once the beneficiary vacated. The real estate agent for the property provided the executor advice that the property was required to be restored prior to it going onto the market for sale. On DD MM 20YY, a tax invoice was provided for services rendered in respect of the end of lease garden clean-up. On DD MM 20YY, the second legal dispute was resolved. Between MM 20YY to MM 20YY, the executor took steps to remove the beneficiary's personal belongings from the property. On DD MM & DD MM, the executor conducted a garage sale at the property. Tax invoices were provided in respect of costs of tip fees. The executor was limited in what they could outsource due to the limited liquid cash in the estate. A sum was transferred by the executor to Company A Lawyers when they had carriage of the estate matter. Such funds were reserved in case proceedings were commenced against the estate by the beneficiary. The executor was only able to attend the property on weekends due to their work commitments and when friends and family were available to assist them. The executor carried out the property clean-up by themself with the assistance of family and friends. The entering of a lease between the estate and the beneficiary (upon advice from Company B) gave the beneficiary additional rights over the property and limited the executor's ability to simply discard of the beneficiary's personal belongings. In MM 20YY, an interested purchaser for the property was located. On DD MM 20YY, the property was sold. On DD MM 20YY, the beneficiary filed a Caveat on the property. On DD MM 20YY and DD MM 20YY, the executor consulted a law firm. On DD MM 20YY, the caveat was removed by the beneficiary. On DD MM 20YY, the property settled. Even post the sale of the property the beneficiary continues to threaten to commence proceedings against the estate.

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