Private ruling: Commissioner's discretion - capital gains tax
Date of advice: 27 August 2025
Published: 27 October 2025
Ruling period: Income year ending DD MM 20YY
Date scheme commenced: DD MM 20YY

Ruling: Q1: Will the Commissioner exercise the discretion to allow an extension of time for you to dispose of your ownership interest in the property 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: On DD MM 20YY the deceased acquired a X% ownership interest in the property. The deceased held their ownership interest with another owner. The deceased lived in the property. The property was their main residence until they were admitted to hospital shortly before their passing. The property is on land of less than 2 hectares. The property was not rented or used to produce income. On DD MM 20YY, the deceased passed away. The deceased died intestate. The deceased had children. Following the deceased's passing, some of the deceased's children continued residing in the property. The deceased's other children initially understood that the children occupying the property were managing the estate. However, they later became aware that no formal steps had been taken to administer the estate. They first discover this in late 20YY, after becoming aware of an outstanding bailiff notice and an unpaid bill. It became clear that no action was being taken to manage the estate and the property was in very poor condition. Upon discovering this the other children promptly sought legal advice and applied for Letters of Administration. On DD MM 20YY, the other children lodged an application for Letters of Administration with the Court. On DD MM 20YY, Letters of Administrators are granted to the other children as Administrators. Once Letters of Administration were granted, the Administrators progressed the sale as quickly as possible. However, during this period, they were unable to access the property to prepare it for sale. The property could not be accessed when they applied for Letters of Administration because the children occupying the property were refusing entry and were creating significant barriers to accessing and managing the estate. Given their behavior and history, the Administrators needed to give priority their own safety and the safety of their families before taking any action. As a result, professional intervention from police and trades was required before they could safely access the property. On DD MM 20YY, following confirmation that the occupants were residing unlawfully in the property and were not paying rent, the Administrators took actions to vacate the property. This resulted in the police attending the property and evicting the occupying children. After the property was vacated, it was found to be in a state of disrepair, with significant rubbish and damage. Remedial work was necessary to ensure basic legal compliance before listing the property for sale. State legislation listing the minimum standards required for the property include: • The Electricity Regulations. • Plumbing Regulations. • Gas Regulations. The repairs required to ensure basic compliance to list the property, included: • Late MM - MM 20YY - Quotes obtained for rubbish removal and compliance certificates. • Removal of all rubbish and debris inside and outside, $X paid by one of the Administrators. • MM 20YY - Rubbish removal completed. • Electrical safety testing and smoke alarm certification - paid for by one of the Administrators. • Gas safety testing and issues rectified - paid for by one of the Administrators. • MM-MM 20YY - Electrical and gas compliance completed On DD MM 20YY, the other owner notified the Administrators by letter that they would buy the deceased's ownership interest. On DD MM 20YY, a sales contract was signed. The contract became unconditional on DD MM 20YY with settlement to occur 30 days later. On DD MM 20YY, settlement occurred. Summary of the reasons for the delay which were beyond the Administrators' control: • A genuine misunderstanding within the family regarding estate responsibilities led to delays in administration. • Once the children who were not occupying the property became aware of the situation, they acted without delay by obtaining legal representation and pursuing the appropriate legal process. • Regaining access to the property was not immediate and further delayed our ability to prepare it for sale. • The property was never rented, occupied by others, or used for financial gain during this time. • Significant time and resources were required to clean, repair, and bring the property up to saleable condition. • Awaiting inspection feedback and coordination with the buyer requirements before proceeding with further works. • Safety concerns and the need to ensure the property could be entered without risk. • Multiple rounds of communication with lawyers and the courts to arrange redaction of personal addresses for both Administrators in legal documents. • Contacting the occupying children via tracked mail to ensure formal notification and proof of delivery. • The time required to organise appointments with lawyers and other professionals, as well as waiting for response times from the buyer. • General administrative delays in securing quotes, booking trades, and aligning availability with required compliance inspections.

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