Private ruling: Deceased estate two-year discretion
Date of advice: 28 August 2019
Published: October 2019
Ruling period: Year ending 30 June 20XX

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 to the two year period? | A1: Yes. Having considered the circumstances and the relevant factors the Commissioner will apply the discretion under subsection 118-195(1) of the ITAA 1997 and allow a short extension of time.

Relevant facts and circumstances: The deceased passed away more than XX years ago. The deceased owned a property. The dwelling at the property was their main residence at the time of their passing. The dwelling was not used to derive assessable income and is on land that is less than two hectares in size. The deceased's last will, appointed Person A as executor and trustee of the will. Probate was granted a number of months after the deceased's death. Under the will, Person A was to receive the dwelling and Person A planned to move in; however was this did not occur due to extreme personal circumstances. The property was subsequently listed for sale. Due to the downturn in the market, the sale price was reduced a number of times in order to achieve a sale. There have been no improvements made to the property. The dwelling was sold and settled just a few months after the two year period had ended.

Relevant legislative provisions: Income Tax Assessment Act 1997 Subdivision 115-A | Income Tax Assessment Act 1997 Section 102-20 | 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