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INCOME TAX ASSESSMENT ACT 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-45 - RULES FOR PARTICULAR INDUSTRIES AND OCCUPATIONS  

Division 355 - Research and Development    View history reference

Subdivision 355-H - Feedstock adjustments    View history reference

SECTION 355-465  Feedstock adjustment to assessable income  

 View history reference

355-465(1)  

This section applies to an *R & D entity for an income year (the present year ) if:


(a) it incurs expenditure in one or more income years in acquiring or producing goods, or materials, (the feedstock inputs ) transformed or processed during *R & D activities in producing one or more tangible products (the feedstock outputs ); and


(b) it obtains under section 355-100 *tax offsets for one or more income years for deductions under this Division:


(i) for the expenditure; or

(ii) for expenditure it incurs on any energy input directly into the transformation or processing; or

(iii) for the decline in value of assets used in acquiring or producing the feedstock inputs; and


(c) during the present year, a feedstock output, or a transformed feedstock output, (the marketable product ) is:


(i) *supplied by the R & D entity to another entity; or

(ii) applied by the R & D entity to the R & D entity ' s own use, other than use for the purpose of transforming that product for supply.

355-465(2)  

The *R & D entity ' s assessable income for the present year includes an amount equal to 1/3 of the lesser of:


(a) the *feedstock revenue for the feedstock output; and


(b) so much of the total of the amounts deducted as described in paragraph (1)(b) that is reasonably attributable to the production of the feedstock output.

Note:

This subsection applies separately for each of the feedstock outputs.

355-465(3)  

Subsection (2) does not apply to the feedstock output if:


(a) it becomes, or is transformed into, a feedstock input; or


(b) that subsection already applies to the feedstock output because of the application of paragraph (1)(c) to:


(i) an earlier time during the present year; or

(ii) an earlier income year.


 



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