Income Tax Assessment Act 1936

Div 3 heading inserted by No 172 of 1978.

S 73Y repealed by No 164 of 2007 , s 3 and Sch 11 item 42, effective 25 September 2007. For application provision, see note under s 73B(1AAA) . For transitional provisions regarding reduced notional expenditure on foreign owned R & D, see note under s 73P(1) .

Act No 164 of 2007 , s 3 and Sch 1 item 79, contained the following further transitional provision:

79 Transitional provisions - deductions under former section 73Y of the Income Tax Assessment Act 1936  
(1)
This item modifies paragraphs 73T(3)(a) and (4)(a) and 73V(3)(a) of the Income Tax Assessment Act 1936 as amended by this Schedule for the Y ₀ year of income that is the first year of income starting after 30 June 2007.

(2)
Those paragraphs have effect for that year of income as if an eligible company or one of its group members could deduct an amount under section 73QA for the Y _-1 year of income if the company or group member had been eligible to claim an additional deduction under section 73Y of that Act (as in force before the commencement of this Schedule) for that Y _-1 year of income.

(3)
A term that is used in this item and had a meaning given by any of sections 73P to 73Z of the Income Tax Assessment Act 1936 immediately before the commencement of this Schedule has the same meaning in this item.

S 73Y formerly read:

SECTION 73Y ADDITIONAL DEDUCTION  
73Y(1)
The object of this section is to provide a tax incentive, in the form of a deduction, to make eligible companies more internationally competitive by:

(a) encouraging the development by eligible companies of innovative products, processes and services; and

(b) increasing investment by eligible companies in defined research and development activities; and

(c) promoting the technological advancement of eligible companies through a focus on innovation and high technical risk in defined research and development activities; and

(d) encouraging the use by eligible companies of strategic research and development planning; and

(e) creating an environment that is conducive to increased commercialisation of new processes and product technologies developed by eligible companies.

The benefits of the tax incentive are targeted by being limited to particular expenditure on certain defined activities.

73Y(2)
Each of the companies that have all or part of the premium amount distributed to it can deduct the lesser of:

(a) 50% of that amount for the year of income for which it is distributed; or

(b) 50% of the amount of incremental expenditure incurred by the company in the Y ₀ year of income that is eligible for a deduction under section 73B at the rate of 125%.

Note:

The paragraph (2)(b) amount may be less than the paragraph (2)(a) amount because of sections 73C , 73CA or 73CB .

S 73Y inserted by No 170 of 2001.