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What are eligible activities?

Last updated 26 May 2005

To be eligible for the active business exemption, you must establish that the foreign company was principally engaged in one or more eligible activities. [section 496]

All business activities(including the provision of services) that are not named in Schedule 4 of the ITAA 1936 are eligible activities (for a complete list, refer to the ITAA 1936). Mining and agriculture, for example, are eligible activities. However, being named in Schedule 4 does not necessarily make activities ineligible activities - see Appendix 2: Business activities that are not eligible activities for more information.

There are two methods for establishing whether a foreign company is principally engaged in eligible activities:

  • the stock exchange listing method, and
  • the balance sheet method.

If both of the methods can be applied, you may choose which one to use. [section 498]

Also see Appendix 2: Business activities that are not eligible activities for more information.

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