Hari started up a new business this year selling old vinyl records. For the year ended 30 June 2020, Hari advises that his total sales were $18,000 and his expenses were $25,000. Hari rents a small shop in an outer suburb of Adelaide and the market value of that shop was $400,000. What is Hari's taxable income for the year ended 30 June 2020?
A) Tax loss of $7,000 and no deferred non-commercial loss
B) Taxable income of $0 and a deferred non-commercial loss of $7,000
C) Taxable income of $7,000
D) Tax loss of $25,000

Question

Quizplus · Accepted Answer

Hari's taxable income is $0 because his expenses ($25,000) exceed his sales ($18,000). The deferred non-commercial loss is $7,000, which is the amount of the loss that cannot be claimed as a deduction against other income in the current year.

Hari Started Up a New Business This Year Selling Old