What happens with the jointly held assets if you die at the same time with your spouse?
If I die first my joint tenancy asset goes the survivor. This is my spouse. Or if my spouse dies first I get my spouse’s interest in the joint tenancy asset.
But what if we both die at the same time? For example, in a car accident or from an aeroplane crash. And it is not possible to get the order of death.
In all Australian states the law states the order of death is that the oldest dies first. The order of death is oldest to youngest. The oldest person is deemed to die a second before the younger person.
This means the youngest person gets the joint tenant asset.
When your parents die you have two years to sell their CGT family home. (A family home is usually tax-free, but not always.)
If you sell the family home within two years of their death then you do not pay any Capital Gains Tax. For example, your parent’s principal place of residence is worth $3m when they die. You sell it 2 years later for $4m. The whole $4m is tax-free. You pocket the extra $1m with no Capital Gains Tax.
But what if you cannot sell the deceased’s home within 2 years of death? Perhaps there was an issue getting Probate or someone is challenging the Will or there is a life estate or a slightly different ‘right to reside‘.
Under certain circumstances, the ATO can extend that 2-year exemption for a further 12 months. If the ATO is satisfied to do so the ATO gives you a tax-free 3-year holiday.
