Private ruling: Commissioner's discretion special circumstances - non-commercial losses
Date of advice: 27 November 2020
Published: January 2021
Ruling period: Year ended 30 June 20XX | Year ended 30 June 20XX | Year ended 30 June 20XX | Year ending 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Will the Commissioner exercise his discretion to allow you to include any losses from your non-primary production business in the calculation of your taxable income for the 20XX-XX, 20XX-XX, 20XX-XX and 20XX-XX financial years? | A1: Yes. Having considered your circumstances and the relevant factors the Commissioner has granted his discretion. It is accepted that your business activity was affected by special circumstances outside your control which prevented you from passing a test. 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 carry on a non-primary production business. In the financial year 20XX-XX, you had a relapse of an illness which severely affected your ability to work. Your business activity totalled $XX for this financial year. Over the financial years 20XX-XX and 20XX-XX your health slowly improved and your ability to work increased to where your business income totalled $XX for the 20XX-XX financial year. Had it not been for the sudden relapse of the illness, your income for the 20XX-XX financial year would have been greater than $20,000. You have met the income test in previous financial years.

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(a) | Income Tax Assessment Act 1997 paragraph 35-55(1)(a)