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This edited version has been archived due to the length of time since original publication.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: 1051325097382

Date of advice: 9 January 2018

Ruling

Subject: Non-commercial losses

Question

Will the Commissioner exercise the discretion in paragraph 35-55(1)(a) of the Income Tax Assessment Act 1997 (ITAA 1997) to allow you to include any losses from your business activity in your calculation of taxable income for the 2016-17 financial year?

Answer

Yes

Having regard to your full circumstances, it is accepted that your business activity was affected by special circumstances outside your control. It is also accepted that, but for the special circumstances, you would have made a tax profit, and you have met, or would have met one of the four tests. Consequently the Commissioner will exercise his discretion in the 2016-17 financial year.

This ruling applies for the following period(s)

Year ended 30 June 2017

The scheme commences on

1 July 2016

Relevant facts and circumstances

Your income for non-commercial loss purposes for the 2016-17 financial year is over $250,000.

You carry on a business.

You commenced business operations in 2003.

You submit that you were affected by special circumstances in the 2016-17 financial year.

You submit that circumstances impacted on the profitability of your business in the following way:

Relevant legislative provisions

Income Tax Assessment Act 1997 subsection 35-10(1)

Income Tax Assessment Act 1997 subsection 35-10(2)

Income Tax Assessment Act 1997 subsection 35-10(2E)

Income Tax Assessment Act 1997 paragraph 35-55(1)(a)


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