Private ruling: Capital gains tax two years extension
Date of advice: 30 November 2020
Published: January 2021
Ruling period: Year ending 30 June 2021
Date scheme commenced: 1 July 2020

Ruling: Q1: Will the Commissioner exercise his discretion under subsection 118-195(1) of the Income Tax Assessment Act 1997 (ITAA 1997) in relation to the dwelling on the property and allow an extension of time to the two years period to the date of settlement of the property? | 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 52250' on ato.gov.au

Relevant facts and circumstances: The deceased passed away on mid 20XX. The property was the deceased's main residence. The property was never used for income producing purposes. The deceased's relative was given the option of buying the property which they accepted. In order to purchase the property, the relative had to sell their rental property and secure a loan. The rental property was being rented from late 20XX. The relative agreed to sell the rental property to the then tenant with an original settlement date of early 20XX. The tenant had difficulty obtaining a loan as they lost their job due to circumstances related to COVID-19. The tenant confirmed they still intended to purchase the rental property and sought and received financial assistance from their family. The rental property subsequently settled on mid 20XX. There was a delay in the relative purchasing the deceased's property as they were reliant on the rental property selling first. There was a further delay due to the bank advising the valuation would take a longer period of time due to the valuer having to travel from City Z. The deceased's property settled on late 20XX.

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