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Death and income tax – Some discrete issues: part 2
Published on 01 Apr 20 by "TAXATION IN AUSTRALIA" JOURNAL ARTICLE
This is the final part of a two-part series examining some standalone issues about tax and deceased estates. This article looks at the intricacies of the main residence exemption as it applies to a trustee or beneficiary of the estate. It examines how the cost base of the deceased’s dwelling is determined in the hands of the trustee/beneficiary and the conditions that need to be satisfied for a full exemption, including the Commissioner’s safe harbour for the sale of a dwelling outside the standard two-year exemption period. Importantly, the article also considers the recent changes that can deny the main residence exemption in some cases where the deceased person or beneficiary is a foreign resident. This article also considers when an agreement will be accepted by the Commissioner as satisfying the requirements of s 128-20(1)(d) of the Income Tax Assessment Act 1997 (Cth) as being a deed of arrangement under which an asset passes to a beneficiary.
Author profiles
Lyn Freshwater
Lyn is a member of the Tax Counsel Network in the Australian Taxation Office in Brisbane. Her work in recent years has focused on trust-related issues including litigation (such as EISS, Lewski, Sandini) and various public advice and guidance products. She led the development of, and authored, draft Practical Compliance Guideline PCG 2017/D12 (liability of a legal personal representative of a deceased person). - Current at 12 July 2018Mark Morris FTI
Mark is the Principal of Morris and Associates which is a consulting firm advising a diverse range of public companies, private family groups and practitioners on complex tax matters including business structuring, mergers and acquisitions, employment taxes and succession planning. Mark has over 36 years experience in the tax profession having held senior roles in chartered accounting, commerce and academia. He is also the Co-Chair of the ATO’s Digital Implementation Group and a member of the NTLG FBT Working Group and the Tax Practitioners Stewardship Group. He is also a regular speaker and author on tax matters. Mark is a registered tax agent, a member of The Tax Institute and CPA Australia and has been admitted to practice as a solicitor in Victoria. - Current at 16 August 2021
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