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INCOME TAX ASSESSMENT ACT 1997 - SECT 118.195

Dwelling acquired from a deceased estate

             (1)  A * capital gain or * capital loss you make from a * CGT event that happens in relation to a * dwelling or your * ownership interest in it is disregarded if:

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

                     (b)  at least one of the items in column 2 and at least one of the items in column 3 of the table are satisfied; and

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

 

Beneficiary or trustee of deceased estate acquiring interest

Item

One of these items is satisfied

And also one of these items

1

the deceased * acquired the * ownership interest on or after 20 September 1985 and the * dwelling was the deceased's main residence just before the deceased's death and was not then being used for the * purpose of producing assessable income

your * ownership interest ends within 2 years of the deceased's death, or within a longer period allowed by the Commissioner

2

the deceased * acquired the * ownership interest before 20 September 1985

the * dwelling was, from the deceased's death until your * ownership interest ends, the main residence of one or more of:

(a) the spouse of the deceased immediately before the death (except a spouse who was living permanently separately and apart from the deceased); or

(b) an individual who had a right to occupy the dwelling under the deceased's will; or

(c)  if the * CGT event was brought about by the individual to whom the * ownership interest * passed as a beneficiary--that individual

Note 1:       You may make a capital gain or capital loss if the dwelling was used for the purpose of producing assessable income: see section 118-190.

Note 2:       In some cases the use of a dwelling to produce assessable income can be disregarded: see sections 118-145 and 118-190.

Note 3:       There are special rules for dwellings acquired before 7.30 pm on 20 August 1996. These rules also affect the operation of section 118-192 and subsections 118-190(4) and 118-200(4): see section 118-195 of the Income Tax (Transitional Provisions) Act 1997 .

          (1A)  For the purposes of a provision of this Subdivision that applies the table in subsection (1):

                     (a)  disregard paragraphs (a) and (b) in column 3 of item 2 of the table if, just before the deceased's death, the deceased was an * excluded foreign resident; and

                     (b)  disregard paragraph (c) in column 3 of item 2 of the table if, at the time the relevant * CGT event happened, the individual was an excluded foreign resident.

Note:          The other provisions that apply the table include paragraph 118-192(3)(b), subsection 118-200(2), paragraph 118-225(3)(c) and section 118-260.

             (2)  Only these * CGT events are relevant:

                     (a)  CGT events A1, B1, C1, C2, E1, E2, F2, K3, K4 and K6 (except one involving the forfeiting of a deposit); and

                     (b)  a CGT event that involves the forfeiting of a deposit as part of an uninterrupted sequence of transactions ending in one of the events specified in paragraph (a) subsequently happening.

Note:          The full list of CGT events is in section 104-5.



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