Private ruling: Deceased estate 2-year discretion
Date of advice: 2 October 2025
Published: 24 November 2025
Ruling period: Year ended 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Will the Commissioner exercise the discretion under section 118-195 of Income Tax Assessment Act 1997 to allow an extension of time for you to dispose of your ownership interest in the dwelling and disregard the capital gain or capital loss you made 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 ato.gov.au for 'QC 66057'.

Relevant facts and circumstances: The deceased passed away on XX/XX/20XX. The deceased acquired the property prior to 20 September 1985. The property was the main residence of the deceased just before they passed away and was not used to produce assessable income at that time. The property was situated on less than two hectares of land. The deceased's Will appointed their child, Person A as their executor and trustee. The Will appointed the deceased's other children, Person B and Person C as trustees. On XX/XX/20XX, probate was granted to Person A. The deceased's Will provided Person A to live in and occupy the property for as long as they wished and free of rent, but subject to them paying all the rates, taxes and other outgoings in respect of the property, keeping the property insured at all times against loss and damage from fires, storm and tempest; and keeping same in reasonable repair having regard to the condition of the property as at the date of their death. On XX/XX/20XX, Person A passed away. Prior to their death, the property had been Person A's main residence for their whole life. In XX/20XX, Person B engaged with Company A to obtain a grant of Letters of Administration for Person A's estate. On XX/XX/20XX, Person B and Person C were informed that a grant of Letters of Administration with the Will annexed de bonis a administratis was needed for the deceased's estate to allow the estate to be finalised. From XX/20XX until XX/20XX, enquiries were made for Person A's estate and if a valid Will existed. A Will could not be located, and it was determined that Person A had passed away intestate. On XX/XX/20XX, an application for a grant of Letters of Administration with the Will annexed de bonis administratis was made to the Supreme Court of State A (the Supreme Court) for the deceased's estate. On XX/XX/20XX, a request was received from the Supreme Court in relation to the application. On XX/XX/20XX, documentation was sent to the Supreme Court addressing their queries. On XX/XX/20XX, a further request from the Supreme Court was received in relation to the deceased's estate. The Supreme Court advised that a grant needed to be obtained for Person A's estate before the deceased's estate could be finalised. On XX/XX/20XX, Person C passed away. Person C was entitled to a portion of Person A's estate and had previously consented to Person B obtaining a grant in both the deceased's estate and Person A's estate. On approximately XX/XX/20XX, an application for a grant of Letters of Administration was made to the Supreme Court for Person A's estate by Person B. On XX/XX/20XX, Letters of Administration for Person A's estate was granted to Person B. On XX/XX/20XX, Letters of Administration for Person A's estate was filed with the Supreme Court. On XX/XX/20XX, probate was issued for Person C's estate. On XX/XX/20XX, the Supreme Court requested for the consent of the legal personal representative and a copy probate for Person C's estate. On XX/XX/20XX, a response estate was filed with the Supreme Court. On XX/XX/20XX, a grant of Letters of Administration with the Will annexed de bonis administratis was issued for the deceased's estate. Following the grant of Letters of Administration for the deceased's estate, Person B cleared the property and prepared it for sale. On XX/XX/20XX, the property was listed for sale. The property remained vacant after Person A passed away until it was sold. A contract was entered to sell the property on XX/XX/20XX with settlement occurring on XX/XX/20XX.

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