Private ruling: : CGT - deceased estate
Date of advice: 4 July 2022
Published: October 2022
Ruling period: Period ending 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Will the Commissioner grant an extension to the CGT exemption period of two years for the sale or of the property from the estate of Person A? | A1: Yes. Having considered the circumstances and relevant factors you have provided, the Commissioner will exercise his discretion and allow an extension of the 2-year limit for an exemption from CGT on the disposal of an inherited property. CGT is disregarded from the deceased's date of death until the disposal of your ownership interest in the property. Further information about this discretion can be found by searching 'QC 66055' on ato.gov.au.

Relevant facts and circumstances: Person A deceased XX XX 20XX. Person B deceased XX XX 20XX. Person A and Person B owned the property located at XXXX. The property was purchased in 19XX and is a pre-CGT asset. At the time of Person A's decease, Person A and Person B had a case in Family Court to obtain a financial settlement from their separation. Person B resided in the property until their decease. As such the property could not be sold until after this date. Person A and Person B were no longer joint tenants of the property at the time of Person A's decease. Your siblings challenged Person B's will based on their capacity. The Supreme court heard the case in 20XX. XX XX 20XX probate was granted to you for Person A's estate and two executors for Person B's estate. In 20XX your siblings lodged an appeal, and it was agreed that the assets in Person B's estate would not be sold until the appeal was resolved. This included the property. During the appeal you approached real estate agents in order to sell the property when it was resolved. No one resided in the property after Person B's decease, and it was never used to produce income. When the appeal decision was handed down, you contracted trades people to conduct repairs and to paint the house in order to sell it in early 20XX. COVID-19 restrictions delayed the sale due to physical inspections not being able to take place. A contract of sale for the property was signed XX XX 20XX. Settlement occurred XX XX 20XX.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 118-195 | Income Tax Assessment Act 1997 subsection 118-195(1)