Private ruling: CGT - deceased estates - 2 year discretion
Date of advice: 26 June 2025
Published: 1 September 2025
Ruling period: Year ended 30 June 20YY
Date scheme commenced: 1 July 20YY

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? | 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: On DD MM 20YY the deceased acquired the property at X The property is less than 2 hectares. The property was the deceased's main residence and never used to produce income. The deceased passed away on DD MM 20YY. The deceased was overseas at the time of their death. The deceased was survived by their spouse and four children, two of which are minor beneficiaries. In MM 20YY the deceased's spouse applied for a grant of letters of administration as the deceased's will was invalid. In MM 20YY two of the deceased's children lodged a probate caveat. In MM 20YY the administrator filed an application for removal of the probate caveat with a hearing listed for DD MM 20YY. On DD MM 20YY the probate caveat was withdrawn. On DD MM 20YY a court requisition was issued to the administrator requiring arrangements for the protection of the interests of the minor beneficiaries. On DD MM 20YY, the administrator entered a deed to protect the minor beneficiaries' interests in the estate. On DD MM 20YY letters of administration were granted to the spouse and they commenced administration of the estate. The administrator was residing in xx. On DD MM 20YY the executor returned to the property and found significant water damage due to a burst pipe at the property. The administrator lodged an insurance claim; however, this was declined by the insurer on DD MM 20YY. On DD MM 20YY the administrator applied for a title transfer of the property as executor. On DD MM 20YY the administrator was advised the title could not be transferred as two of the beneficiaries had lodged a property caveat. The administrator instructed their legal representation to seek removal of the property caveat. Between MM 20YY and MM 20YY the administrator cleared the property of household items and possessions. In MM 20YY the administrator received legal advice that a legal challenge to the insurance claim would prove more costly than simply attending to property repairs. In MM 20YY the administrator sought quotes for repairs to the flood damage at the property. Repairs to the property commenced in MM 20YY and were completed on DD MM 20YY. On DD MM 20YY the two beneficiaries withdrew the property caveat. The property was listed for sale on in MM 20YY and sold on DD MM 20YY, with settlement occurring on DD MM 20YY.

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