Private ruling: CGT - deceased estates - small business concessions
Date of advice: 22 September 2023
Published: 6 November 2023
Ruling period: Year ending 30 June 2021 | Year ending 30 June 2022 | Year ending 30 June 2023 | Year ending 30 June 2024
Date scheme commenced: 1 July 2020

Ruling: Q1: Will the Commissioner exercise the discretion under subsection 152-80(3) of the Income Tax Assessment Act 1997 (ITAA 1997) to extend the time limit, allowing the Executors to liquidate the shares in Company X that were acquired by the deceased after 20 September 1985? | A1: Yes, due to the difficulties the executors have experienced in selling the property, the Commissioner will exercise the discretion under subsection 152-80(3) of the ITAA 1997 to extend the time limit allowed for the liquidation of shares.

Relevant facts and circumstances: Person A passed away when they were over 55 years of age. At this time of their death Person A was the sole shareholder of Company X. Approximately 1/3 of the shares held by Person A in Company X were acquired after 20 September 1985 (post-CGT shares). Company X owns a property that was used throughout its ownership by Person A in a business that Person A carried on, either alone or at times in partnership. At the time of their death Person A conducted the relevant business as a sole trader. The Executors previously confirmed by private ruling that they were entitled, under section 152-80 of the ITAA 1997, to apply the CGT Small Business Concessions to the disposal or liquidation of the 9000 shares that the deceased acquired post-CGT. A number of attempts and agreements to sell the property have fallen through. The property has not been sold in order to allow the liquidation of the relevant shares within the 2-year statutory period. The Executors have provided a thorough explanation of their previous and continuing efforts to sell the property

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