Private ruling: Commissioner's discretion - deceased estate
Date of advice: 15 October 2025
Published: 1 December 2025
Ruling period: Year ending 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Will the Commissioner exercise their discretion under section 118-195 of the Income Tax Assessment Act 1997 to extend the two-year period for you to dispose of your interest in the Property? | A1: Yes. Having considered your circumstances and the relevant factors the Commissioner will allow an extension of time until settlement on the sale of the Property occurred. Therefore, you can disregard any capital gain or capital loss made on the disposal of your interest in the Property.

Relevant facts and circumstances: Prior to 20 September 1985, your parents, Person A and Person B, purchased a property (the Property). The Property had a land area less than two hectares with a house located on it. You have two siblings being Person X and Person Y. Person X has experienced ongoing health issues, having been diagnosed with a medical condition when they were a child and had undergone numerous major medical treatments, with complications experienced over the years. Person A passed away and their interest in the Property was transferred to Person B. Person X moved into the Property to look after Person B following Person A's passing. Some years later Person B moved into a nursing home when Person X became too ill to continue caring for them, with Person X continuing to reside at the Property. Several months later Person B (the Deceased) passed away. The Deceased was the sole owner of the Property just prior to them passing away. The Deceased's Will did not provide for any person to have a right to occupy the Property, but for you and your siblings to receive an equal share in the Property. Probate was granted several months after the Deceased passed away for the Deceased's Estate to Person X, Person Y and you as the executors appointed under the Deceased's Will (the Trustees). The Trustees made an absence choice under section 118-145 of the ITAA 1997 on behalf of the Deceased to continue to treat the Property as the Deceased's main residence after the Deceased had moved out of it until they had passed away. Some months later the title of the Property was transferred into Person X's, Person Y's and your names, as the beneficiaries of the Deceased's Will as tenants in common with equal shares. You and your siblings shared the power, water and rates expenses. Person X did not pay you and Person Y any rental amount in relation to them continuing to reside at the Property. From the time the Deceased passed away onwards Person X had serious ongoing health issues which required them to spend significant periods in hospitals. When not in the hospital, Person X required daily care at the Property for various periods on a significant number of occasions. During this period Person X was not able to move to another property either mentally or medically and was not capable of trying to move to another location on their own. Person X passed away with the Property remaining vacant after their passing. Probate for Person X's estate was granted, with it being agreed between Person Y, the trustee of Person X's estate and you that the Property would be sold. The Property was put on the market shortly after probate for Person X's estate was granted, with a contract of sale being entered into some months later. Settlement on the sale of the Property occurred more than two years after the Deceased passed away.

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