Private ruling: Extend the time limit to allow the CGT event to occur outside the standard two-year period following the deceased's death.
Date of advice: 19 March 2026
Published: 11 May 2026
Ruling period: Year ended 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Will the Commissioner exercise his discretion under section 152-80(3) of the Income Tax Assessment Act 1997 (ITAA 1997) and allow an extension of time until 30 June 20XX? | A1: Yes

Relevant facts and circumstances: • The name of the deceased was XXXX XXXXXX XXXXXXX (referred to as "XXXX") • XXXX's spouse was XXXXXXXXXX XXXXXXXX (referred to as "XXXXX"). • XXXX passed away on XX XXX 20XX the deceased was over 55 years old and was XXXXX's spouse of XX years. • The 2-year anniversary of XXXX's passing was XX XXX 20XX. • XXXX owned the XXXXXXX Farm which comprises 2 lots, being Lot 1 on SPXX and Lot 2 on RPXX (the "Farm"). • The Farm formed part of XXXX's Estate upon their passing. • By their will XXXX provided that: (1) the Public Trustee would act as executor, and (2) XXXXX would receive the entirety of XXXX's Estate, of which the main asset was the Farm. • Disputes arose with respect to the Estate, which culminated in further and better provision claims being pursued in the XXXXXXXXX Supreme Court by two adult children of XXXX and XXXXX's, being XXX XXXXXXXX and XX XXXXXXXX. • The action by XXX was negotiated and agreed in March 20XX. The action by XX was resolved with consent Court Orders being made on XX XX 20XX. • During the period XX 20XX to XX XX 20XX, the Public Trustee took the steps to complete the administration of the Estate, including payment of the court ordered provision to XX and the transmission of the Farm to XXXXX. • The Estate administration was completed on XX XX 20XX. • No CGT event happened to the Farm in the 2-year period from XXXX's passing. The Executor would not have been able to sell the Farm, due to resolving the legal claims. • Ownership of the Farm passed to XXXXX upon completion of the Estate's administration. • Since becoming the owner, XXXXX had been actively taking steps to sell the Farm and was being assisted by their child XXXX. • XXXXX was actively readying the Farm for sale, including removal of rubbish, removal of fallen trees across internal roads, and repairs needed due to the lack of maintenance during the Estate period. • XXXXX had been advised that a sales campaign of at least 6 months was likely to be required with respect to sale of the Farm. • A sale contract for the Farm was executed on XX XX 20XX (referred to as "the Sale Contract"). • Prior to execution of the Sale Contract, XXXXX was actively seeking to assure legal access to the Farm, as required for a purchaser. XXXX had informal permission for access from the former XXXXXXXXX Electricity Board. XXXXX was negotiating with the XXXXXXXXX government's successor entity -XXXXX XX - for access by way of easement. • The Sale Contract contains a special condition stipulating: - that an easement must be registered by XXXXX as the seller on or before 30 June 20XX (referred to as "the Sunset Date"); - the seller may, by written notice to the buyer, extend the Sunset Date by up to 3 months if required; and - if registration of the easement has not occurred by the Sunset Date, either party may terminate the Sale Contract. • XXXXX is not carrying out, or planning, any improvements to the Farm. XXXXX is not carrying out, and is not planning to carry out, any business activities on the Farm. XXXXX is not residing, and is not planning to reside, on the Farm. • XXXX would have been eligible to use the CGT Small Business Concessions - if they had disposed of the Farm just before their date of death - to reduce or disregard the capital gain made on the Farm disposal. • XXXX met the maximum net asset value test just before their date of death. • XXXX's affiliate using the Farm to carry on its business in the year of their death was a small business entity with aggregated turnover less than $2 million (in the financial year of XXXX's death and in the preceding financial year). • XXXX met the active asset test for the Farm, due to their use of it in partnership with XXXXX to operate an orchard business, their use of it in partnership with XXXXX and XXXXX to operate a business, and their affiliate's use of it to operate a business. The Farm was not mainly used to derive rent. • XXXX would have met the active asset requirement in their year of death due to their affiliates' business use of the Farm.

Relevant legislative provisions: Section 152-80 Income Tax Assessment Act 1997

Reasons for decision: Summary: Section 152-80 of the ITAA 1997 allows beneficiaries under a deceased individual's will to access the small business CGT concessions in the same manner the deceased would have been entitled to immediately before their death. The Farm passed to you as beneficiary under your spouse's will. You have confirmed that your spouse would have been eligible to reduce or disregard a capital gain arising from the disposal of the Farm under the CGT small business concessions had the disposal occurred immediately before their death. The proposed sale of the Farm will not occur within the 2-year period specified in paragraph 152-80(1)(d). Accordingly, access to the CGT small business concessions under section 152-80 is only available if the Commissioner exercises the discretion to extend the period within which the Farm may be disposed of. In determining whether the discretion to allow further time would be exercised, the Commissioner has considered the following factors: • an acceptable explanation for the period of the extension requested (and whether it would be fair and equitable in the circumstances to provide such an extension) • prejudice to the Commissioner which may result from the additional time being allowed (but the mere absence of prejudice is not enough to justify the granting of an extension) • unsettling of people, other than the Commissioner, or of established practices • fairness to people in like positions and the wider public interest • whether any mischief is involved, and • consequences of the decision. Application to your circumstances In this case, the administration of the estate was delayed due to court proceedings arising from an ongoing dispute, the inability to undertake necessary repairs to the property during the executorship and the need to obtain an easement. These factors collectively prevented the timely disposal of the Farm. Having considered the relevant circumstances, the Commissioner is able to exercise the discretion in subsection 152-80(3) of the ITAA 1997 to extend the period in paragraph 152-80(1)(d) of the ITAA 1997 to 30 June 2026. Accordingly, the requirement in paragraph 152-80(1)(d) of the ITAA 1997 is taken to be satisfied in relation to the Farm.