Private ruling: Non-commercial losses - assessable income
Date of advice: 26 October 2020
Published: December 2020
Ruling period: Year ended 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Will the Commissioner allow you to include any losses from your business activity in the calculation of your taxable income for the 20XX-XX financial year? | A1: Yes Having considered your circumstances and the relevant facts it would be reasonable to estimate had the business activity been carried on throughout the year that you would have achieved income of at least $XXX. Further information on non-commercial losses can be found by searching 'QC 33774' on ato.gov.au.

Relevant facts and circumstances: You satisfy the less than $250,000 income requirement set out in subsection 35-10(2E) of the Income Tax Assessment Act 1997. You purchased a food truck with a plan to trade outside venues when events they were scheduled. Due to state implemented restrictions you did not commence trading until you gained the necessary documentation from your local council. You utilise several delivery approaches to meet your customer needs for meal deliveries. A reasonable estimate would have seen you to able to meet the assessable income test in the financial year 20XX-XX on a pro-rata basis had you carried on the business activity throughout the 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 subsection 35-30(b) | Income Tax Assessment Act 1997 paragraph 35-55(1)(a)