Private ruling: Capital gains tax – deceased estate
Date of advice: 12 December 2017
Published: May 2018
Ruling period: 30 June 2018
Date scheme commenced: 1 July 2017

Ruling: Q1: Will the Commissioner exercise the discretion under subsection 118-195(1) of the Income Tax Assessment Act 1997 (ITAA 1997) and allow an extension of time until settlement date? | A1: Yes Having considered your circumstances and the relevant factors, the Commissioner is able to apply his discretion under subsection 118-195(1) of the ITAA 1997 and allow an extension of time until settlement date. Further information on the relevant factors and inherited dwellings generally can be found on our website ato.gov.au and entering Quick Code QC52246 into the search bar at the top right of the page.

Relevant facts and circumstances: You purchased property in 19XX (pre-CGT) and this became your main residence up until your date of death. At the time of purchase you placed the property in the names of relatives as joint tenants with equal shares. One of your relatives passed away in 20XY. You died in 20XX and your residuary estate was left to your relatives. Probate of the will was granted in 20XX to one of your relatives. In 20XX, the will was contested and the matter went to Court. This dispute was not resolved until 20XX where a settlement was made. The property was placed on the market and sold and settlement occurred in 20XX.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 104-10, | Income Tax Assessment Act 1997 section 118-195 and | Income Tax Assessment Act 1997 subsection 118-195(1). Further issues for you to consider | A capital gain or capital loss you make is disregarded if you acquired the asset before 20 September 1985.