Private ruling: Grouping similar business activities for non-commercial loss purposes
Date of advice: 11 April 2019
Published: May 2019
Ruling period: ● Financial year ending 30 June 2018
Date scheme commenced: 1 July 2017

Ruling: Q1: Is your sole trader outlet business activity and your partnership outlet business activity considered to be of a similar kind for non-commercial loss purposes? | A1: Yes. Having considered your circumstances your two direct chemist outlet business activities satisfy the relevant factors in identifying similar business activities in Taxation Ruling TR 2001/14 . Further information on the similar business activities for non-commercial business purposes can be found by searching 'QC 55241' on ato.gov.au

Relevant facts and circumstances: During the 2017-18 financial year you operated two outlet business activities. Both activities are operated under the same retail banner, the products sold and the services provided are identical, and both are conducted in the same state. You operated the outlet ‘A’ as a sole trader for all of the 2017-18 financial year and the outlet ‘B’ as a sole trader for only part of the 2017-18 financial year. For the remainder of the year you operated outlet ‘B’ under the partnership arrangement. During the 2017-18 financial year outlet ‘A’ made a loss. However outlet ‘B’ was profitable under both the sole trader and partnership arrangements. The overall position of the two business activities was a loss.

Relevant legislative provisions: Income Tax Assessment Act 1997 Division 35 | Income Tax Assessment Act 1997 Section 35-10(3)