Private ruling: Commissioner's discretion for non-commercial business losses
Date of advice: 22 January 2021
Published: March 2021
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 Based on the evidence you have provided, that your business was affected by special circumstances beyond your control, the Commissioner will exercise his discretion to allow your business loss in the 20XX financial year to be deducted against other income and not require the business loss to be deferred. For more information on non-commercial losses, please visit our website ato.gov.au and enter quick code "QC 33774" in the search area at the top of the page.

Relevant facts and circumstances: You commenced business partway through the 20XX financial year as a sole trader Your income for non-commercial loss purposes was greater than $250,000 in the 20XX financial year. Your business was affected by special circumstances outside your control (COVID-19). You predict you will make an assessable profit in year 2. You have provided several supporting documents.

Relevant legislative provisions: Income Tax Assessment Act 1997 Division 35 | Income Tax Assessment Act 1997 section 35-1 | Income Tax Assessment Act 1997 subsection 35-10(2) | Income Tax Assessment Act 1997 subsection 35-10(2E) | Income Tax Assessment Act 1997 section 35-55 | Income Tax Assessment Act 1997 paragraph 35-55(1)(a)