Private ruling: Deceased estate and the capital gains tax (CGT) main residence exemption
Date of advice: 23 June 2017
Published: August 2017
Ruling period: Year ending 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Will the Commissioner exercise the discretion in section 118-195 of the Income Tax Assessment Act 1997 (ITAA 1997) and extend the main residence exemption to 20XX? | 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 20XX. Further information on the relevant factors and inheriting a dwelling generally can be found on our website ato.gov.au and entering Quick Code QC17195 into the search bar at the top right of the page.

Relevant facts and circumstances: Your father passed away on 20XX. His estate contained a property which was purchased after 20 September 1985. The property was his main residence at the time of his passing and has not been used to produce assessable income. One of the beneficiaries of the estate could not be contacted for extended periods of time. Work needed to be completed on the property to remove two sheds that did not meet council requirements. Your relative was assisting with the removal and also passed away during the removal process. You engaged a third party to remove the sheds and materials from the property to prepare it for sale. The third party delayed and caused further damage to the property, resulting in more work being required. The property was sold by contract and settled on 20XX.

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