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This edited version has been archived due to the length of time since original publication. It should not be regarded as indicative of the ATO's current views. The law may have changed since original publication, and views in the edited version may also be affected by subsequent precedents and new approaches to the application of the law.

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Edited version of your written advice

Authorisation Number: 1051230355453

Date of advice: 1 June 2017

Ruling

Subject: Non Commercial Loss: Commissioner's Discretion

Question

Will the Commissioner exercise the discretion in paragraph 35-55(1)(c) of the Income Tax Assessment Act 1997 (ITAA 1997) to allow you to include any losses from your primary production business activity in your calculation of taxable income for the 20YY financial year?

Answer

Yes

Having considered your circumstances, it is accepted that it is the nature of the business activity that has prevented you making a tax profit. It is also accepted that you will make a tax profit within the commercially viable period for your industry. Consequently the Commissioner will exercise his discretion in the 20YY financial year.

For more information on non-commercial losses, please visit our website at https://www.ato.gov.au/Business/Non-commercial-losses/, or search quick code QC 33774 at www.ato.gov.au.

This ruling applies for the following period:

For the year ended 30 June 20YY

The scheme commences on:

1 July 20XX

Relevant facts and circumstances

You do not satisfy the <$250,000 income requirement set out in subsection 35-10(2E) of the ITAA 1997.

You carry on a business at property A and property B.

The business is primarily concerned with broad acre grain cropping.

You commenced business operations in the 20YY financial year.

You have provided independent evidence that attests to a commercially viable period of one year for your industry.

You intend to make a tax profit in the 20ZZ financial year.

You have provided an interim profit and loss statement which shows your return to profit.

Relevant legislative provisions

Income Tax Assessment Act 1997 Division 35

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