Private ruling: Commissioner's discretion - deceased estate
Date of advice: 8 August 2025
Published: 7 October 2025
Ruling period: Year ending 30 June 20YY
Date scheme commenced: DD MM YYYY

Ruling: Q1: Will the Commissioner exercise the discretion under section 118-195 of Income Tax Assessment Act 1997 (ITAA 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: On DD MM YY, the deceased acquired a majority share in a property located at XX XX (the property). The remaining minority share by a close family member, Beneficiary 1, who lived in the property until the property was sold. In MM YY, the deceased moved into a nursing home. On DD MM YY, the deceased passed away. The property had not been income‐producing or available for rent at any time throughout the deceased's lifetime or throughout the estate administration. The size of the property is less than 2 hectares. The deceased left an informal Will, dated DD MM YY. The Will requested their interest in the property be distributed to two close family members, being Beneficiary 1 and Beneficiary 2. The Will included a number of deficiencies as to the requirements of the Wills Act 1970 (State). The deficiencies of the informal Will resulted in it taking approximately X months between the date of death on DD MM YY and the granting of probate on DD MM YY. Legal proceedings ensued between Beneficiary 1 and Beneficiary 2 with respect to the ownership interests of the property and appropriate division of the property of the estate. The legal proceedings were resolved on the terms of a Deed of Settlement, approved by the Supreme Court. The substance of those orders including an order for the property to be sold and an order stating that the property was from DD MM YY held beneficially XX% for Beneficiary 1 and XX% for Beneficiary 2. The period between commencement and resolution of the legal matters concerned the majority of the time between granting of probate and commencement of the process to sell the property. A licensed real estate agent was appointed to sell the property on about DD MM YY. On DD MM YY a contract was entered in to sell the property, subject to finance. On DD MM YY settlement of the property occurred.

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