Private ruling: Capital gains tax - deceased estate - Commissioner's discretion extend two year period
Date of advice: 4 December 2019
Published: February 2020
Ruling period: Year ending 30 June 2020
Date scheme commenced: 1 July 2016

Ruling: Q1: Will the Commissioner allow an extension of time for you to dispose of your ownership interest in the dwelling and disregard the capital gain you make on the disposal? | 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 and their spouse acquired the residential property in the 200X-0X income year. The property was transferred solely to the deceased pursuant to court order in the 200X-XX income year. The deceased died in the 20XX-XX income year. The property was the deceased main residence from date of purchase through to the date of their passing. The property has never been used to produce income. The deceased had two biological children and two adopted children. By the last Will of the deceased, two of the children were sole beneficiaries of the property. Grant of probate was granted to the two children in the 20XX-XX income year. The property was initially listed for sale in the 20XX-XX income year. It was withdrawn for sale five months later. Solicitors of the two adopted children notified the estate lawyers of their existence in the 20XX-XX income year. In the 20XX-XX income year, the estate lawyers were put on notice of Testator Family Maintenance (TFM) Claim and requested no further distribution of estate. The estate lawyers withdrew from acting on behalf of the estate. In the 20XX-XX income year, a Supreme Court Order removed two children as executors and trustees of the Estate. The court appointed independent administrator as both the administrator and trustee of the estate. In the 20XX-XX income year, the property was placed on the market. In the 20XX-XX income year, mediation occurred to settle TFM Claim. In the 2019-20 income year, a Contract for sale was signed. Settlement occurred in the same income year.

Relevant legislative provisions: Income Tax Assessment Act 1997 Section 104-10 | Income Tax Assessment Act 1997 Subsection 118-130(3) and | Income Tax Assessment Act 1997 Section 118-195