Private ruling: Commissioner's discretion for special circumstances
Date of advice: 20 July 2017
Published: November 2017
Ruling period: Year ended 30 June 2017
Date scheme commenced: 1 March 2015

Ruling: Q1: Will the Commissioner exercise the discretion in paragraph 35-55(1)(a) of the Income Tax Assessment Act 1997 (ITAA 1997) to allow you to include any losses from your business activity in your calculation of taxable income for the 2016-17 financial year? | A1: Yes Having regard to your full circumstances, it is accepted that your business activity was affected by special circumstances outside your control, and that these prevented you meeting one of the four tests. Consequently the Commissioner will exercise his discretion in the 2016-17 financial year. For more information on non-commercial losses, please visit our website ato.gov.au and enter quick code QC 33774 into the search bar at the top right of the page.

Relevant facts and circumstances: You satisfy the <$250,000 income requirement set out in subsection 35-10(2E) of the ITAA 1997. You carry on a business from home. You commenced business operations in the 2014-15 financial year. You submit that you were affected by special circumstances in the 2016-17 financial year. You submit that the special circumstances impacted on your business in the following ways: ● You were paid Parental Leave payments from Centrelink and you were unable to work in your business due to the restrictions surrounding the payment ● When your child was born, the child required special in-home care until they passed away in 2016 ● You intend to make a profit/make $20,000 in assessable in come in the 2017-18 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)(a)