Private ruling: Non-commercial losses - Commissioner's discretion - special circumstances
Date of advice: 1 July 2020
Published: August 2020
Ruling period: Year ended 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? | 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 (ITAA 1997). You carry on a non-primary production business. You became injured in XXXX and required an operation. You would normally work XX hours per week however due to your injury you were no longer able to work. This has caused a significant reduction in the income received by the business. The business activity has resulted in a net loss for the 20XX-XX financial year. The business has always produced a profit, up until you became injured.

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)