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

105   Before Subdivision 716-Z

Insert:

Subdivision 716-V - Research and Development

Table of sections

716-500 Head company bound by agreements binding on subsidiary members

716-505 History for entitlement to tax offset: joining entity

716-510 History for entitlement to tax offset: leaving entity

716-500 Head company bound by agreements binding on subsidiary members

Section 355-220 (about R&D activities conducted for a foreign entity) applies to the *head company of a *consolidated group as if the head company were bound by an agreement during any period that a *subsidiary member of the group is bound by the agreement.

716-505 History for entitlement to tax offset: joining entity

If:

(a) a company becomes a *subsidiary member of a *consolidated group; and

(b) apart from this section, things happening in relation to the company before it became a subsidiary member would, because of section 701-5 (the entry history rule), be taken into account as things happening in relation to the *head company for working out the head company’s *aggregated turnover for the purposes of section 355-100 (tax offsets for R&D);

the things happening are not to be taken into account as mentioned in paragraph (b).

716-510 History for entitlement to tax offset: leaving entity

If:

(a) a company ceases to be a *subsidiary member of a *consolidated group; and

(b) while the company was a subsidiary member, things happened in relation to an entity which, if section 701-1 (the single entity rule) were disregarded:

(i) would be *connected with the company; or

(ii) would be an *affiliate of the company; or

(iii) would have the company as an affiliate; and

(c) those things would, if section 701-1 were disregarded, have been taken into account in working out the company’s *aggregated turnover for the purposes of section 355-100 (tax offsets for R&D); and

(d) the things are not also things that, because of section 701-40 (the exit history rule), are taken into account as things happening in relation to an eligible asset etc. (within the meaning of that section) of the company in working out for the entity core purposes the company’s aggregated turnover for the purposes of section 355-100;

the things are to be taken into account in working out the company’s aggregated turnover for the purposes of section 355-100.


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