Navigating CGT Implications on Deceased Estate Property Disposal


Navigating complex Capital Gains Tax (CGT) implications is crucial when the legal personal representative (LPR) or beneficiary disposes of a property from a deceased estate. Understanding CGT exemptions and conditions is essential. In this blog post, we explore scenarios and considerations that impact CGT treatment, providing insights for a smooth transition.

In Scenario A – Pre-CGT Dwelling, properties acquired by the deceased before September 20, 1985 (pre-CGT) can claim a complete exemption if disposed of within two years of death. Exemptions may still apply if the deceased’s spouse, a specified individual under the will, or a beneficiary used the property as their main residence. Relief for exceptional circumstances can extend the two-year timeframe, subject to conditions outlined by the Australian Taxation Office (ATO).

In Scenario B – Post-CGT Dwelling, properties acquired by the deceased after September 20, 1985 (post-CGT) come into play for a full main residence exemption. The dwelling must have been the main residence of the deceased, not income-producing, and must meet conditions from Scenario A. The acquisition date determines additional conditions, making it essential to understand CGT implications based on when the property was acquired.

Transitioning to Foreign Residents:

Excluded foreign residents, residing abroad for over six years, encounter restrictions in accessing the CGT main residence exemption. Transitional rules apply to properties purchased before May 9, 2017, and sold on or before June 30, 2020. If the deceased was an excluded foreign resident at the date of death, none of the CGT main residence concessions apply, irrespective of their previous use of the property as their main residence.

Seeking professional advice in the intricate landscape of deceased estate taxation is paramount. Transitioning to the expertise of EndureGo Tax, your local accountant in Inner West Sydney, is crucial. EndureGo Tax emerges as an expert, guiding you through CGT complexities associated with deceased estates. With a deep understanding of the legislation and its nuances, EndureGo Tax ensures you navigate the process seamlessly, offering comprehensive support in managing CGT obligations when disposing of a property from a deceased estate.

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