The non-commercial loss rule already operates to prevent the deduction of losses from an individual's ‘non-commercial' business activity against other income. Instead, the loss is deferred and offset against profits arising from the same business activity in later years. However, there are some exemptions available to keep the losses e.g. assessable income from the business activity for the year is at least $20,000, recent profits, real property test greater than $500,000 and other assets used exceed $100,000. Another exemption is available to:- - Primary production business; or
- Professional arts business
if taxpayers' income from other sources (e.g. employment income) is less than $40,000. The new rule will be - none of these exemptions will be available to a taxpayer whose adjusted taxable income exceeds $250,000
24th-July-2009 | 