Private ruling: Income tax - small business concessions - extension of time for a deceased estate
Date of advice: 14 September 2020
Published: November 2020
Ruling period: Year ended 30 June 20XX
Date scheme commenced: 01 July 20XX

Ruling: Q1: Will the Commissioner exercise his discretion under subsection 152-80(3) of the Income Tax Assessment Act 1997 (ITAA 1997) to extend the two year time limit? | A1: Yes. In this instance we consider that you have provided a reasonable explanation for the delay in disposal of the CGT asset. We do not consider allowing this request would cause the unsettling of others. Accordingly, the Commissioner will exercise his discretion under subsection 152-80(3) of the ITAA 1997 to extend the time period to settlement.

Relevant facts and circumstances: The Deceased operated a Primary Production activity being a beef cattle farm as a sole trader. Prior to their death the Deceased would have been eligible to utilise the Small business CGT concessions. The Deceased passed away, with probate being granted to the Legal Personal Representatives (LPRs) who continued to operate the small business enterprise. Market analysis of the property was conducted, with the property being listed for sale. The LPRs have endeavoured to sell all assets of the Estate of the Deceased, circumstances beyond their control, including drought, have resulted in the asset of active farming land, not being sold and settled within two years of the date of death of the Deceased. Offers on the drought impacted property have been limited. Initial offers were received in January 20XX and July 20XX. With an offer for sale accepted April 20XX, however notification was received from the purchaser that they would not proceed with the purchase. A final offer was received with settlement occurring.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 104-10 | Income Tax Assessment Act 1997 subsection 152-80(3)