Private ruling: The Commissioner's discretion for non-commercial losses
Date of advice: 10 September 2019
Published: November 2019
Ruling period: Year ended 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: 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 financial year? | A1: 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

Relevant facts and circumstances: You acquired land in the 20XX financial year. This land was used for private purposes for each of the financial years from 20XX to 20XX. In 20XX you applied for a planning permit to develop the land you possessed. Approval of this permit was granted in 20XX. In 20XX, you obtained a building permit to commence business activity. You commenced work on the land in 20XX. You do not satisfy the <$250,000 income requirement set out in subsection 35-10(2E) of the ITAA 1997. You commenced business operations in the 20XX financial year.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 35-10. | Income Tax Assessment Act 1997 section 35-55.