Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-1 - CAPITAL GAINS AND LOSSES: GENERAL TOPICS  

Division 118 - Exemptions  

Subdivision 118-B - Main residence  

Dwellings acquired from deceased estates

SECTION 118-200   Partial exemption for deceased estate dwellings  

118-200(1)    
You get only a partial exemption (or no exemption) if:

(a) you are an individual and your *ownership interest in a *dwelling *passed to you as a beneficiary in a deceased estate, or you owned it as the trustee of a deceased estate; and

(b) section 118-195 does not apply.

118-200(2)    

You calculate your *capital gain or *capital loss using the formula:

CG or CL amount

×

Non-main residence days       Total days

where:

CG or CL amount
is the *capital gain or *capital loss you would have made from the *CGT event apart from this Subdivision.

non-main residence days
is the sum of:

(a) if the deceased *acquired the *ownership interest on or after 20 September 1985 - the number of days in the deceased ' s *ownership period when the *dwelling was not the deceased ' s main residence; and

(aa) if the deceased acquired the ownership interest on or after 20 September 1985 and, just before the deceased ' s death, the deceased was an *excluded foreign resident - the number of remaining days in the deceased ' s ownership period; and

(b) the number of days in the period from the death until your ownership interest ends when the dwelling was not the main residence of an individual referred to in item 2, column 3 of the table in section 118-195 .

total days
is:

(a) if the deceased *acquired the *ownership interest before 20 September 1985 - the number of days in the period from the death until your ownership interest ends; or

(b) if the deceased acquired the ownership interest on or after that day - the number of days in the period from the acquisition of the dwelling by the deceased until your ownership interest ends.

118-200(3)    

However, you can adjust the formula by ignoring any non-main residence days and total days in the period from the deceased ' s death until your *ownership interest ended, if:

(a) the deceased *acquired the ownership interest on or after 20 September 1985; and

(b) your ownership interest ends within:

(i) 2 years of the deceased ' s death; or

(ii) a longer period allowed by the Commissioner; and

(c) you get a more favourable result by doing so; and

(d) the deceased was not an *excluded foreign resident just before the deceased ' s death.

Note 1:

The formula in this section will be adjusted (or further adjusted) under section 118-205 if the deceased acquired the dwelling through a deceased estate.

Note 2:

There may be a further adjustment if the dwelling was used for the purpose of producing assessable income: see section 118-190 .

118-200(4)    
You ignore any non-main residence days before the deceased ' s death if:

(a) the *dwelling was the deceased ' s main residence just before the death; and

(b) the dwelling was not being used for the *purpose of producing assessable income just before the death, or any use for that purpose just before the death was ignored because of subsection 118-190(3) or (3A) ; and

(c) the deceased was not an *excluded foreign resident just before the deceased ' s death.