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Edited version of your written advice
Authorisation Number: 1051415956621
Date of advice: 28 August 2018
Ruling
Subject: Non-commercial business losses and the Commissioner’s discretion
Are your currency trading business activities undertaken under a partnership arrangement and as a sole trader, considered to be “businesses activities of a similar kind” for the purpose of subsection 35-10(3) of the Income Tax Assessment Act 1997 (ITAA 1997)?
Answer
Yes. It is accepted that your business activities undertaken under a partnership arrangement and as a sole trader, are ‘business activities of a similar kind’ for the purpose of subsection 35-10(3) of the ITAA 1997.
Question 2
Do you pass the income requirement set out in subsection 35-10(2E) of the ITAA 1997?
Answer
Yes. You pass the income requirement set out in subsection 35-10(2E) of the ITAA 1997, as the sum of your taxable income, reportable fringe benefits, reportable superannuation contributions and net financial investment losses is less than $250,000.
Question 3
Will the deferral rule contained in subsection 35-10(2) of the ITAA 1997 apply to prevent your activity losses from being offset against other assessable income in the 2016-17 financial year?
Answer
No. The deferral rule contained in subsection 35-10(2) of the ITAA 1997 will not apply to prevent your activity losses from being offset against other taxable income, as you satisfy the assessable income test at paragraph 35-30(a) of the ITAA 1997 2016-17 financial year.
This ruling applies for the following period:
Year ending 30 June 2017
The scheme commences on:
1 July 2016
Relevant facts and circumstances
You carry on currency trading business activities under both a sole trader and partnership arrangement.
For the 2016-17 financial year you made a net taxable loss from the sole trader activity and your share of the partnership loss.
Your taxable income for the 2016-17 financial year was less than $250,000.
You did not have reportable fringe benefits, reportable superannuation contributions or net financial investment losses for the 2016-17 financial year.
Relevant legislative provisions
Income Tax Assessment Act 1997 Subsection 35-10(2)
Income Tax Assessment Act 1997 Subsection 35-10(2E)
Income Tax Assessment Act 1997 Subsection 35-10(3)
Income Tax Assessment Act 1997 Paragraph 35-30(a)