The ATO has made it pretty clear they think that carrying on a business, including regular share trading, potentially breaches the sole purpose test. You can assume that day trading would be particularly in their sights.
The question is do you want to attract their attention, bearing in mind that your auditor is required to report on your compliance with the sole purpose test every year. Personally, I want to keep as far away from the ATO and lawyers as I possibly can.
If people start pushing the boundaries then we can expect the ATO to push for legislative changes. So if there is a grey area/loophole here, expect it to be closed pretty soon.
