Private ruling: Capital gains tax and the commissioner's discretion to extend the two year period
Date of advice: 22 July 2019
Published: September 2019
Ruling period: Year ending 30 June 2019
Date scheme commenced: 1 July 2018

Ruling: Q1: Will the Commissioner exercise his 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 to XX June 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 XX June 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: The deceased passed away on XX June 20XX. The deceased owned a property. The property was the deceased main residence. The final Will of the deceased named A and B as the executors of the estate. At the time of the deceased death, B was living in the above residence. A mortgage was outstanding over the property. It was advised that the property would need to be sold in order to repay the loan in full. B subsequently advised that they did not consent to the sale of the property, creating a dispute between A and B. After attempted negotiations failed, probate was granted for the estate and A was appointed an individual executor on XX January 20XX. Despite obtaining this grant, B continued to refuse to leave the deceased property. Further legal action was taken to remove B from the property. B was not successfully removed from the property until XX August 20XX. This caused considerable delay to preparing the property for placement on the real estate market. A real estate agent was appointed in November 20XX. A potential purchaser was not located until X April 20XX. Unfortunately this contract fell through. A subsequent purchaser was located; however this contract also fell through. A final purchaser was located on XX April 20XX. A contract was signed on May 20XX, with settlement occurring on XX June 20XX.

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