Tax Laws Amendment (Tax Incentives for Innovation) Act 2016 (54 of 2016)

Schedule 2   Venture capital investment

Part 5   Requirements for entities in which VCLPs, ESVCLPs and AFOFs invest

Income Tax Assessment Act 1997

24   Paragraphs 118-425(3)(a) to (c)

Repeal the paragraphs, substitute:

(a) more than 75% of the assets (determined by value) that are assets of either:

(i) the company; or

(ii) any entity controlled by the company in a way described in section 328-125 (a controlled entity );

must be used primarily in activities that are not ineligible activities mentioned in subsection (13) of this section;

(b) more than 75% of the persons who are employees of either or both of the following:

(i) the company;

(ii) any one or more of its controlled entities;

must be engaged (as such employees) primarily in activities that are not ineligible activities mentioned in subsection (13) of this section;

(c) more than 75% of the total assessable income, *exempt income and *non-assessable non-exempt income of:

(i) the company; and

(ii) each of its controlled entities;

must come from activities that are not ineligible activities mentioned in subsection (13) of this section.