Hill v FCT (2019) AAT 1723

The Tribunal has held that a taxpayer who traded shares was not carrying on a business, and therefore, was not entitled to claim losses or carry them forward in the 2015, 2016 and 2017 income years.

It was found that overall the share trading activities were not carried out in a business-like manner.  While the taxpayer made a “very significant investment” in dollar terms in the share market, the activities “lacked the sophistication to be a share trading business.”

The judgement sets out the numerous factors that lead to this conclusion.

The question is essentially one of fact.  In deciding this issue, the case law has established the following factors as generally relevant considerations:

  1. The nature of the activities and whether they have the purpose of profit-making;
  2. The complexity and magnitude of the undertaking;
  3. An intention to engage in trade regularly, routinely or systematically;
  4. Operating in a business-like manner and the degree of sophistication involved;
  5. Whether any profit/loss is regarded as arising rom a discernible pattern of trading;
  6. The volume of the taxpayer’s operations and the amount of capital employed by him;

And more particularly in respect of share traders:

  1. Repetition and regularity in the buying and selling of shares;
  2. Turnover;
  3. Whether the taxpayer is operating to a plan, setting budgets and targets, keeping records;
  4. Maintenance of an office;
  5. Accounting for share transactions on a gross receipts basis;
  6. Whether the taxpayer is engaged in another full-time profession.


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