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Edited version of private advice
Authorisation Number: 1052082659609
Date of advice: 1 February 2023
Ruling
Subject: Am I in business of trading?
Question
Were you carrying on a business of trading?
Answer
Yes.
Based on the information provided, the Commissioner has agreed that you satisfied the indicators outlined in Taxation Ruling TR 97/11 Income tax: am I carrying on a business of primary production? for the financial year ended 30 June 20XX. The profit-making purpose of your activity and the prospect of profit from the activity, its significant commercial character, repetition and regularity, its planned, organised and carried on in a business-like manner along with its size, scale and permanency together indicate that you were carrying on a business of trading.
This ruling applies for the following period:
Year ended 30 June 20XX
The scheme commenced on:
1 July 20XX
Relevant facts and circumstances
You commenced your trading activities in late 20XX.
You conduct your trading activities as a sole trader.
You invested your own capital to allow you to engage in this trading activity.
Over the course of the income year, you made hundreds of trades across more than 30 different investments.
You have traded using several different platforms.
The trades you made were short term, with less than 12 months between the purchase and sale time of investments.
You keep records of all your trades in detailed Excel spreadsheets.
You spent a minimum of several hours per day on your trading activity.
You performed multiple analysis techniques to assist in making trades, including technical analysis.
Based on your daily analysis, you would reposition your assets accordingly to minimise the risk of losses.
You followed a trading strategy developed by yourself based on your personal knowledge and prior investment experience.
You are subscribed to several institutions and research groups, both paid and unpaid, to research and study the market and to determine potential trades.
You are employed full time in an unrelated role which allows you to reserve several hours a day to research the market.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 6-5
Income Tax Assessment Act 1997 Section 8-1
Income Tax Assessment Act 1997 Section 995-1