Private ruling: Commissioner's discretion - deceased estate
Date of advice: 28 November 2025
Published: 12 January 2026
Ruling period: Year ended 30 June 20YY | Year ending 30 June 20YY
Date scheme commenced: DD MM 20YY

Ruling: Q1: Will the Commissioner exercise the discretion under section 118-195 of Income Tax Assessment Act 1997 (ITAA 1997) to allow an extension of time for you to dispose of your 50% ownership interest in the dwelling and disregard the capital gain or capital loss you made on the disposal? | A1: Yes. Having considered your circumstances and the relevant factors the Commissioner will allow an extension of time. Further information about the Commissioner's discretion can be found by searching ato.gov.au for 'QC 66057'.

Relevant facts and circumstances: In the 19YYs, the deceased purchased a property located at XXX XXX (the Property). The deceased and their child 1 resided in the property. On DD MM 20YY, the deceased passed away. The child 1 continued to live in the property after the deceased passing. The property is less than 2 hectares in size. The property was the deceased's main residence just before their passing. The property was never used for the purpose of producing income during the deceased's ownership. The deceased left a will dated DD MM 20YY appointing their child 1 and child 2 as executors and trustees. The residue of the estate was to be divided equally between the two children. There was no right to reside in the property under the will. On DD MM 20YY, probate was granted to the deceased child 2 and leave was reserved for the deceased child 1. The property ownership was transferred per the will to the child 1 and child 2 of the deceased as joint owners. Between MM 20YY and MM 20YY, the executors agreed to put the property on the market. The deceased child 1 avoided and dismissed meetings to discuss the matter, The promised actions by the deceased child 1 to prepare for sale were not fulfilled. By mid to late 20YY, the deceased child 1 finally agreed to put the property on the market. On DD MM 20YY, the deceased child 2 engaging with the real estate agent. Shortly after the deceased child 1 was not cooperating to get the property ready for sale. The deceased child 2 and child 1 made an agreement allowing the deceased child 1 approx. 12 months until MM 20YY, to grieve and make arrangements to relocate, as the property had been their primary residence for approximately XX years. Once the agreed period had passed, you attempted to engage with the deceased child 1 on several occasions to organise the sale of the property and communicate next steps. As you had no success in engaging with the deceased's child 1 to progress the property sale, by MM 20YY, you sought legal assistance. Numerous legal proceedings took place to eventually obtain a warrant of possession for the deceased child 1 to leave the property. Once the property was vacated, the property was immediately prepared for sale. There were only minor repairs and cleaning to bring the property to a respectable state for sale The property was sold by the beneficiaries of the estate. On DD MM 20YY, the property was listed for sale. On DD MM 20YY, the contract of sale was signed. On DD MM 20YY, the property settled.

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