Tax Laws Amendment (Research and Development) Act 2011 (93 of 2011)

Schedule 3   Other amendments relating to new R&D incentive

Part 6   Other amendments

Income Tax Assessment Act 1997

92   At the end of section 205-15

Add:

(4) An entity’s *franking credit for a payment mentioned in item 1 or 2 of the table in subsection (1) is reduced by the amount (if any) worked out as follows, but not below zero.

Method statement

Step 1. Identify any income years ending before the payment was made for which the entity has *received a refund of income tax.

Step 2. Add up the part (if any) of each of those refunds that is attributable to a *tax offset that is subject to the refundable tax offset rules because of section 67-30 (about R&D).

Step 3. Subtract any reduction under this subsection of a *franking credit for any earlier payment by the entity. (For this purpose, assume a credit reduced to zero is still a franking credit.)