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Edited version of your written advice
Authorisation Number: 1051452866860
Date of advice: 21 November 2018
Ruling
Subject: Non-commercial losses and the Commissioner’s discretion for lead time.
Question
Will the Commissioner exercise the discretion in section 35-55 of the Income Tax Assessment Act
1997 (ITAA 1997) to allow you to include any losses from your plantation business activity (the activity) in the calculation of your taxable income for the 20XX-XX to 20XX-XX financial years?
Answer
Yes.
Having regard to your full circumstances, the Commissioner has granted his discretion as it is accepted there is a 'lead time' in the nature of your business activity and you will 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 periods:
Year ended 30 June 20XX
Year ended 30 June 20XX
Year ended 30 June 20XX
The scheme commences on:
1 XXXXXX 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 own a farming business which commenced on XX/XX/20XX.
The farm consists of around XXX trees between the ages of XX and XX years of age.
You provided a letter from an independent third party stating that trees of your type are at full production in the XX to XX year. The 20XX-XX financial year will be the XX year of operation for the activity.
The business activity will produce a profit 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), and
Income Tax Assessment Act 1997 paragraph 35-55(1)(c).