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Edited version of private advice
Authorisation Number: 1051812740481
Date of advice: 9 March 2021
Ruling
Subject: Commissioner's discretion for non-commercial losses
Question
Will the Commissioner exercise the discretion to allow you to include any losses from your business activity in the calculation of your taxable income for the 20XX-XX financial year?
Answer
Yes.
Having considered your circumstances and the relevant factors the Commissioner has granted his discretion. It is accepted there is a 'lead time' in the nature of your business activity and you will pass a test or make a tax profit within your industry's commercially viable period. Further information on non-commercial losses can be found by searching 'QC 33774' on ato.gov.au
This ruling applies for the following period:
Year ended 30 June 20XX
The scheme commences on:
30 July 20XX
Relevant facts and circumstances
You do not satisfy the <$250,000 income requirement set out in subsection 35-10(2E) of the Income Tax Assessment Act 1997.
You have purchased a property on which you are conducting a primary production activity.
The property was a mature business purchased in a neglected state.
The plants require a period to recover to become commercially productive again.
You project that your activity will produce assessable income greater than the allowable deductions for the activity in the 20XX-XX financial year.
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)(c)
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