Private ruling: Capital gains tax
Date of advice: 23 October 2021
Published: January 2022
Ruling period: Year ended 30 June 20XX | Year ended 30 June 20XX | Year ended 30 June 20XX | Year ending 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Will the Commissioner exercise his discretion under paragraph 124-75(3)(b) of the ITAA 1997 to allow an extension of time to rebuild a dwelling that has been destroyed until 30 June 20XX? | A1: Yes. In your circumstances, your investment property was destroyed by arson. An insurance settlement was later reached, with the intention for the proceeds to be used to rebuild the dwelling. Actions have been taken to find and appoint a builder to rebuild the dwelling. The Commissioner will exercise the discretion under paragraph 124-75(3)(b) and allow an extension of time to 30 June 20XX.

Relevant facts and circumstances: You acquired an investment property in a state separate from your principal place of residence. This property was subject to an event in 20XX and the damages were beyond repair. You received insurance settlement proceeds in 20XX, with the intention being to use the entirety of the settlement proceeds to rebuild like for like. Various factors have impacted your ability to proceed. You appointed a builder in 20XX.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 104-20 | Income Tax Assessment Act 1997 Subdivision 124-B | Income Tax Assessment Act 1997 section 124-10 | Income Tax Assessment Act 1997 section 124-70 | Income Tax Assessment Act 1997 section 124-75