Private ruling: CGT - deceased estate
Date of advice: 15 November 2022
Published: 16 January 2023
Ruling period: Year ending 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Will the Commissioner allow an extension of time to 10 November 20XX 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 this discretion can be found by searching 'QC 66057' on ato.gov.au

Relevant facts and circumstances: The deceased passed away a couple of years ago. You are the child of the deceased and the sole beneficiary of the deceased's estate. The property was purchased by the deceased approximately three decades ago. The property was the deceased's main residence for the whole of their ownership period. The property was never used to produce income. The property was less than 2 hectares. The reasons for the property not selling within the 2 year time period was due to the following: The deceased passed away suddenly and an autopsy was required and this took several months. The financial institutions that the executor needed to deal with required a death certificate of the deceased and the deceased's sibling who was named as one of the executors and passed away over two decades ago before closing accounts. In the following year the property was transferred into your name. You were not able to proceed with the sale of the property as there was an existing mortgage registered to the title of the property. Many attempts were made to release this mortgage. A lawyer lodged the relevant paperwork to release the mortgage with the bank. Several weeks later you followed up with the lawyer and executor as to the release of the mortgage. In the following month the bank requested a certified copy of the will and ID for the executor and the lawyer replied on the same day. By the end of the year the estate was finalised with the expectation that the mortgage would be released on the property as all information had been supplied to the bank. You made a number of attempts to get this finalised with the bank and for several months the bank did not process the release. Several months later the bank contacted the lawyer for you to sign the discharge request, you followed this up straight away. According to the bank the mortgage was discharged the month after you signed the discharge request. The mortgage continued to be registered against the property. A number of phone calls and conversation took place, and you were eventually advised that the mortgage was no longer on the property. A contract for sale was entered into. Settlement took place on over two years from the date of death.

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