Private ruling: CGT main residence exemption 2 year rule
Date of advice: 2 August 2018
Published: October 2018
Ruling period: Year ended 30 June 20XX
Date scheme commenced: 1 July 20XX

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 for the property at XXXX State AA? | A1: Yes In this case, the deceased passed away in 20XX. The deceased’s will was contested and legal action and an appeal application were not finalised until July 20XX. The beneficiaries’ interests in the property were transferred in 20XX. Having considered the relevant facts, the Commissioner is able to apply his discretion under subsection 118-195(1) of the Income Tax Assessment Act 1997 (ITAA 1997) and allow an extension to the 2 year time limit to XX December 20XX.

Relevant facts and circumstances: The deceased passed away in 20XX. The deceased bequeathed a property to their children. The property was valued at the date of death. The property was the deceased’s principle place of residence and was purchased before 20 September 1985. It was the intention of some of the children to transfer their share in the property to one child within 2 years after the deceased passed away. One of the children passed away in 20XX. The deceased’s will was challenged and legal action commenced in 20XX. Probate was granted to the children as executors in 20XX. Judgment was delivered in favour of the defendants in 20XX however the contestant to the will lodged an appeal. The right to appeal expired in 20XX. Valuation of property was undertaken again in 20XX. The interests some of the children were transferred to one child in 20XX.

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