Private ruling: Deceased estate
Date of advice: 15 August 2025
Published: 27 October 2025
Ruling period: Year ended XX XXX 20XX
Date scheme commenced: XX XXX 20XX

Ruling: Q1: Will the Commissioner exercise his discretion under section118-195 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. Having considered the circumstances surrounding the complexity of administering the estate, the Commissioner will allow an extension of time.

Relevant facts and circumstances: The property is located at Address A. The property is on less than 2 hectares. On XX XXX 20XX Person A acquired the property. On XX XXX 20XX Person A (the deceased) passed away. The property was the main residence of the deceased at the time of their passing and was not being used to produce assessable income. The Will nominated two cousins of the deceased, Person B and Person C as executors however they predeceased the deceased. The Will stated that the estate was to be liquidated and the proceeds split up among 14 different beneficiaries being various individuals, charities, and organisations. The largest portion of 36% was bequeathed to Charity A. The deceased left a handwritten document (the informal document) which was found after their admittance to hospital, that significantly altered the distribution of the estate. After their passing the deceased's relatives spent time considering legal options and considering what weight could be given to the informal document. Multiple law firms became involved. Between the Will and the informal document there were approximately 40 beneficiaries involved, some of whom had passed away. Notifying all concerned parties took time. The informal document became the subject of a legal dispute because: • it left the bulk of the estate to the Charity B who sought to have it declared a codicil to the Will • Charity A did not agree that the informal document met the criteria to be classified as a testamentary instrument and sought for the Will to apply. On XX XXX 20XX Charity B made their application to the court to have the document declared a valid codicil and to seek a grant of probate. On XX XXX 20XX a supreme court judgement was delivered that: • determined the informal document was not a valid codicil to the Will of the deceased, and • that due to the passing of the nominated executors prior to the passing of the deceased, granted letters of administration to Person D as legal counsel for Charity A. On XX XXX 20XX probate was granted to Person D. On XX XXX 20XX a contract of sale was signed for the property. On XX XXX 20XX settlement of the property took place.

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