Private ruling: Capital gains tax - deceased estate - 2 year discretion
Date of advice: 18 May 2019
Published: July 2019
Ruling period: Year ended 30 June 2018
Date scheme commenced: 1 July 2017

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 legislative provisions: Income Tax Assessment Act 1997 section 104-10 | Income Tax Assessment Act 1997 subsection 118-130(3) | Income Tax Assessment Act 1997 section 118-195 | Income Tax Assessment Act 1997 subsection 118-195(1)


Relevant facts: The deceased acquired prior to 20 September 1985 with their late spouse a property (The property) | The deceased passed away in 20XX. | The property consisted of a dwelling and a number of separate retail shops and a retail common area all on one common title. | You have obtained a property valuation report which has identified and separately valued the residential house and curtilage (the dwelling), the commercial shops and the retail common area. | The dwelling was the deceased’s main residence. | The deceased resided in an aged care facility from 20XX. | The dwelling was not used to produce assessable income during the deceased’s lifetime. | From the date of death the dwelling was occupied by the deceased’s grandchild rent free for a period. | The deceased made the choice to continue to treat the dwelling as their main residence during their absence. | The deceased was survived by two children, ‘A’ and ‘B’. | The deceased also had another child, ‘C’ who predeceased them. | ‘C’ was survived a number of children who commenced legal proceedings in 20XX in relation to the terms of the deceased’s will. | The legal proceedings were ultimately resolved in 20XX with an issue of the grant of letters of administration with the will annexed as ordered by the Court. The effect of this was that an independent administrator was appointed. | The property was transmitted to the independent administrator as personal representative a short time later. | An auction of the property was scheduled in 20XX. Prior to proceeding to auction various offers were received. The property was sold a short time later in 20XX and settlement occurred in 20XX.