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Edited version of your written advice
Authorisation Number: 1012763251216
Date of advice: 07 February 2015
Ruling
Subject: Am I in business
Question
Will you be considered to be carrying on a business?
Answer
Yes.
This ruling applies for the following periods:
Year ended 30 June 2014-15
Year ended 30 June 2015-16
Year ended 30 June 2016-17
Year ended 30 June 2017-18
Year ended 30 June 2018-19
The scheme commences on:
1 July 2014
Relevant facts and circumstances
You carry on an activity.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 6-5
Income Tax Assessment Act 1997 section 8-1
Reasons for decision
Taxation Ruling TR 97/11 provides a guide to indicators that the courts have held to be relevant as to whether or not a person is carrying on a business. In the Commissioner's view, the factors that are considered important in determining the question of business activity are:
● whether the activity has a significant commercial purpose or character
● whether the taxpayer has more than just an intention to engage in business
● whether the taxpayer has a purpose of profit as well as a prospect of profit from the activity
● whether there is regularity and repetition of the activity
● whether the activity is of the same kind and carried on in a similar manner to that of ordinary trade in that line of business
● whether the activity is planned, organised and carried on in a businesslike manner such that it is described as making a profit
● the size, scale and permanency of the activity, and
● whether the activity is better described as a hobby, a form of recreation or sporting activity.
Whether a business is being carried on depends on the large or general impression gained (Martin v. Federal Commissioner of Taxation (1953) 90 CLR 470; (1953) 10 ATD 226; (1953) 5 AITR 548) from looking at all the indicators of carrying on a business, and no one indicator will be decisive (Evans v. FC of T 89 ATC 4540; (1989) 20 ATR 922).
In your circumstances, the overall impression gained is that you are carrying on a business activity.
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