Private ruling: Deceased estate - 2-year discretion
Date of advice: 26 September 2022
Published: December 2022
Ruling period: Year ended 30 June 20YY
Date scheme commenced: 1 July 20YY

Ruling: Q1: Will the Commissioner allow an extension of time for you to dispose of your ownership interest in the dwelling and disregard the capital gain you make on the disposal? | A1: Yes. Having considered your circumstances and the relevant factors, the Commissioner will allow an extension of time. Further information about the Commissioner's discretion can be found by searching 'QC 66057' on ato.gov.au.

Relevant facts and circumstances: The deceased owned at property that was acquired after 1985. The deceased passed away in MM YYYY. The property was the main residence of the deceased just before they passed away and was not used to produce assessable income at the time of death. The property was situated on less than 2 hectares of land. Probate was granted in MM YYYY. The deceased's Will allowed for their spouse the right to occupy the property for as long as they wished. The deceased's spouse resided at the property until they weren't well enough to reside there alone. In MM YYYY, the deceased's spouse moved into an aged care facility as a permanent resident. The property was vacant from the time that the deceased's spouse moved into an aged care facility until the time that it was sold. The deceased's Will stated that on failure or termination of the right to reside, the property was to form part of the residue of the deceased's estate. The sole residue beneficiary was the deceased's child. In MM YYYY, the agency responsible for organising the Estate contacted the beneficiary to advise that the right to reside was terminated and to ask how they wished to proceed with the property and the Estate's debt. In MM YYYY, the beneficiary advised that they wanted the property to be transferred to them and wanted to pay the Estate's debt. In MM YYYY, the agency responsible for organising the Estate attempted to contact the beneficiary several times regarding the matter. In MM YYYY, the beneficiary advised that they were considering how to pay the Estate's debts so that the property could be transferred. In MM YYYY, instructions were sent to the agency's official solicitor to assist with recouping funds to pay the Estate's debts. In MM YYYY, the official solicitor received a response from the beneficiary advising that they were looking into ways to pay the Estate's debts. By MM YYYY, after several follow up attempts, a response from the beneficiary had not been received. In MM YYYY, the beneficiary notified the official solicitor that they wished to sell the property. The locks of the property were replaced in MM YYYY. The contents of the property were removed in MM YYYY. The property was listed for sale in MM YYYY. A contract to sell the property was entered into in MM YYYY with settlement occurring in MM YYYY.

Relevant legislative provisions: Income Tax Assessment Act 1997 subsection 118-195(1)