Private ruling: Commissioner's discretion - deceased estate
Date of advice: 18 February 2026
Published: 7 April 2026
Date scheme commenced: 1 July 20xx

Ruling: Q1: Will the Commissioner exercise the discretion under section 118-195 of the 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. This private ruling applies for the following period Year ending 30 June 20xx The scheme commenced on: 1 July 20xx


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


Relevant facts: The deceased passed away on XX XX 20XX. | The deceased owned a dwelling (the dwelling). | The dwelling was the deceased's main residence at the time of their death. | A handwritten document was discovered at the dwelling by police. The document required investigation to determine whether it was testamentary. | The deceased's death the subject of a police and coronial investigation. | An interim death certificate was issued in xx 20xx. Further investigation in relation to the handwritten note was required to determine whether the deceased had testamentary capacity at the time the document was prepared. A medical report was received on xx xx 20xx. | Legal advice was provided that advised that the handwritten document should not be propounded as a codicil to the Will. The beneficiaries were advised of this and agreed to the approach. | On xx xx 20xx the final death certificate was registered. A grant of Probate was issued to the Trustees. | The dwelling was not used to produce assessable income. | The land size is less than 2 hectares. | Around xx 20xx a beneficiary, person A advised the Trustees that they would like to purchase the dwelling. | Person A experienced some delays in obtaining finance to acquire the other beneficiary's interest in the dwelling. | On XX XX 20XX a valuation of the dwelling was requested by the Trustee. This was received on XX XX 20XX. | On XX XX 20XX person A instructed a solicitor to prepare a deed of arrangement. | On XX XX 20XX a second valuation was obtained due to the delay transferring the interest in the dwelling. | On XX XX 20XX an updated deed was issued after consultation with the other beneficiary and Trustees. | On XX XX 20XX the Trustees sought legal advice in relation to potential capital gains tax implications. | On XX XX 20XX the advice was received by the Trustees. | On XX XX 20XX the Trustees entered into a deed of arrangement. | On XX XX 20XX settlement occurred.