Private ruling: Capital gains tax and a deceased estate
Date of advice: 9 August 2018
Published: September 2018
Ruling period: Year ending 30 June 2019
Date scheme commenced: 1 July 2018

Ruling: Q1: Will the Commissioner exercise the discretion under subsection 118-195(1) of the Income Tax Assessment Act 1997 (ITAA 1997) and allow an extension of time until settlement date? | 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 until settlement date. Further information on the relevant factors and inherited dwellings generally can be found on our website ato.gov.au and entering Quick Code QC52246 into the search bar at the top right of the page.

Relevant facts and circumstances: The deceased purchased property pre 20 September 1985 as joint owner and this became the deceased’s main residence. The deceased did not own any other property and the dwelling did not produce income at any time. The deceased acquired 100% sole ownership in 20XX and remained at the property as their main residence. The property was also occupied by a deceased’s relative. The deceased passed away 20XX and left a will. Probate was granted to the executor in 20XX. The relative vacated the property and the executor undertook repairs and maintenance to prepare the property for sale. The property was listed for sale in 20XX and a contract of sale was executed on 20XX. Settlement was to be completed on 20XX. Complications arose at this point as the property was encumbered by other parties and caveats were in force. Due to these complications, settlement was extended and once the encumbrance and caveat resolved, settlement was completed in 20XX.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 104-10, | Income Tax Assessment Act 1997 section 118-195 and | Income Tax Assessment Act 1997 subsection 118-195(1).