Inheriting a home, or at least a legal interest in one, could be the largest windfall gain that many Australians ever experience – a gain which can be maximised by the CGT exemption under the “sale within two years” rule in s 118-195(1) of the ITAA 1997. In this respect, the new ATO Draft Practical Compliance Guideline PCG 2018/D6, which allows a taxpayer to “self-assess” if the Commissioner’s discretion should be exercised to allow an extension of this two year period, is of some significance.
Key feature – safe harbour rules
The key feature of PCG 2018/D6 is that it outlines “safe harbour” rules that will enable the taxpayer (ie an LPR or a beneficiary, as the case may be) to “self-assess” whether the Commissioner would favourably exercise the discretion. Readmore