Private ruling: Deceased estate
Date of advice: 22 May 2026
Published: 10 August 2026
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 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: The deceased acquired the property at xx, xxx, xxxx (Volume xxxx, Folio xxx) with their spouse on DD MM 19YY. The property was approximately xx hectares. The dwelling and immediate two hectares was the deceased's main residence and private garden and never used to produce income. The surrounding land was farmed, with part of the land formerly used as a commercial business. At the time of the deceased's death this land was, in part, used for livestock grazing. The deceased's spouse passed away on DD MM 20YY. The property passed to the deceased on DD MM 20YY through right of survivorship. In MM 20YY, the property was subdivided into two lots. Lot xx (Vol. xxxx Fol. xxx) was approximately xx hectares and contained the deceased's main residence. Lot xx (Vol. xxxx Fol. xxx) was approximately xx hectares and comprised vacant land. In MM 20YY, the vacant land (Lot xx) was sold. On DD MM 20YY, the deceased acquired additional land adjacent to the property (Vol xxxx, Folio xxx). The property of the estate was subject to multiple legal proceedings involving the beneficiaries, including those commencing prior to the deceased's death. In MM 20YY, under the Guardianship and Administration Act 1986 a guardian and administrator was appointed to the deceased. In MM 20YY, X of the deceased's children lodged a caveat on the property. On DD MMM 20YY, the guardianship administrator commenced proceedings to recover possession of the property for purpose of the sale. On DD MM 20YY, orders were made for the beneficiary to provide the documentation required to remove the caveat and the proceeding to be dismissed. In MM 20YY, the guardianship administrator lodged an application with a state based Tribunal seeking authorisation to sell the property, or part thereof, to cover the deceased's care and nursing expenses. X of the deceased's children opposed the sale of the farm. On DD MM 20YY the state based Tribunal made the orders sought by the guardianship administrator. On DD MM 20YY, the guardianship administrator commenced proceedings to recover possession of the property for the purpose of sale as authorised by the state based Tribunal. Subsequent concurrent proceedings were brought individually by X of deceased's children seeking declarations the property was held on constructive trust for them as beneficiaries. On DD, DD and DD MM 20YY, the proceedings hearings were held concurrently. On DD MM 20YY, interim orders were made for the deceased to recover possession of the property. The deceased passed away in MM 20YY, and the guardianship appointment lapsed. The deceased's will appointed X of their children as executors. The executors both applied for leave in reserve. The deceased has xx children. On DD MM 20YY, Letters of Administration were granted to the Administrator. On DD MM 20YY final orders were made in each of the proceedings, including appointing the Administrator of the Estate in each of the proceedings. The X beneficiaries applied for leave to appeal, which was subsequently denied on DD MM 20YY. As a result of the subdivision and later land acquisition, the title particulars specified in the deceased's will did not match the title particulars held by the deceased at the date of their death. On DD MM 20YY legal representation for one of the beneficiaries advised a proposal that Lot xx should be subdivided, with that beneficiary retaining ownership of one of the subdivided lots. Between MM 20YY and mid-20YY the Administrator obtained valuations on the proposal and projected timelines. On DD MM 20YY the Administrator sought judicial advice regarding the proper construction of the deceased's will regarding clauses x and x, and clauses x and x. In MM 20YY the Administrator applied for a will construction proceeding with the Supreme Court. On DD MM 20YY, judicial advice was received that the Administrator should administer the estate in accordance with clause x. On DD MM 20YY, the Administrator wrote to the beneficiaries advising the estate's current liabilities and recommending an expeditious sale of the property without subdivision and requesting their response within 14 days. All beneficiaries, except for one of the beneficiaries, consented to the sale as proposed. On DD MM 20YY, legal representation for one of the beneficiaries challenged the Administrator's proposal for sale. On DD MM 20YY, the Administrator commenced Supreme Court proceedings seeking an order to approve the sale of the property as proposed. On DD MM 20YY, the Supreme Court ordered the property be sold as proposed by the Administrator. On DD MM 20YY, the Administrator signed a real estate sale authority. The property was placed on the market in MM 20YY. A contract of sale was signed on DD MM 20YY conditional upon judicial advice that the Administrator had complied with judicial orders regarding both the sale process and expenses relating to the administration of the estate. On DD MM 20YY, judicial advice confirmed the Administrator had complied with the orders. On DD and DD MM 20YY, mediation between beneficiaries who had sought claims against the estate were resolved under a settlement agreement. There were no refurbishments undertaken on the property. The property settled on DD MM 20YY.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 118-120 | Income Tax Assessment Act 1997 section 118-195 | Income Tax Assessment Act 1997 section 128-15