Private ruling: Small business concessions - affiliate relationship
Date of advice: 16 November 2022
Published: 16 January 2023
Ruling period: Year ending 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Is the Company an 'affiliate' of yours as defined under section 328-130 of the Income Assessment Act 1997 (ITAA 1997) from the time of you becoming its directors in the relevant year until the year ending 30 June 20XX? | A1: Yes. The Company is an affiliate of yours under section 328-130 of the ITAA 1997 as the company is considered to have acted or reasonably be expected to act in accordance with your directions or wishes, or in concert with you, in the relation to the affairs of the business of the company for the duration of time in question. Further information on affiliates can be found by searching 'QC 52285' on ato.gov.au.

Relevant facts and circumstances: You are two relatives. You both became the directors of the Company in the relevant year. Your other relative is the sole shareholder of the Company. You run the day-to day operations of the business, including general management and financial planning on equal basis between the two of you. Your other relative has no input as to how the business should operate and does not make any financial decisions regarding the Company.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 328-130