Document ID: chunk:federal_register_of_legislation:C2025C00029:section:4:p7
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 4 (pt 7/10)
Character Range: 768732–771432

section 35‑45 (other assets test); or
 (b) the Commissioner has exercised the discretion set out in section 35‑55 for the business activity; or
 (c) the exception in subsection (4) applied;
for the income year in which the business activity ceased to be carried on or an earlier income year.
 (2B) If you are an individual, either alone or in partnership (whether or not some other entity is a member of the partnership), you cannot deduct an amount under section 40‑880 (business related costs) for expenditure in relation to a *business activity:
 (a) you propose to carry on; or
 (b) another entity proposes to carry on if the other entity is not an individual, either alone or in partnership;
for an income year before the one in which the business activity starts to be carried on.
 (2C) This section applies to an amount that you could have deducted, apart from paragraph (2B)(a), as if it were an amount attributable to the *business activity that you can deduct from assessable income from the activity for the income year in which the business activity starts to be carried on.
 (2D) You can deduct expenditure covered by paragraph (2B)(b) for the income year in which the *business activity starts to be carried on.

Income requirement
 (2E) You satisfy this subsection for an income year if the sum of the following is less than $250,000:
 (a) your taxable income for that year, disregarding your *assessable FHSS released amount for that year;
 (b) your *reportable fringe benefits total for that year;
 (c) your *reportable superannuation contributions for that year;
 (d) your *total net investment losses for that year.
For the purposes of paragraph (a), when working out your taxable income, disregard any excess mentioned in subsection (2) for any *business activity for that year that you could otherwise deduct under this Act for that year.

Grouping business activities
 (3) In applying this Division, you may group together *business activities of a similar kind.

Exceptions
 (4) The rule in subsection (2), (2A) or (2B) does not apply to a *business activity for an income year if:
 (a) the activity is a *primary production business, or a *professional arts business; and
 (b) your assessable income for that year (except any *net capital gain) from other sources that do not relate to that activity is less than $40,000.
 (5) A professional arts business is a *business you carry on as:
 (a) the author of a literary, dramatic, musical or artistic work; or
Note: The expression "author" is a technical term from copyright law.  In general, the "author" of a musical work is its composer and the "author" of an artistic work is the artist, sculptor or photographer who created