Income Tax Assessment Act 1997
(a) an *R & D entity incurs expenditure to another entity on all or part of an *R & D activity; and
(i) when the R & D entity incurs the expenditure, the R & D entity and the other entity do not deal with each other at *arm ' s length; or
(ii) the other entity is the R & D entity ' s *associate; and
(c) the expenditure exceeds the *market value of the relevant R & D activity or part (as appropriate);
for the purposes of this Division, the R & D entity is treated as if the amount of expenditure it incurred on the relevant R & D activity or part (as appropriate) were equal to that market value.
For the purposes of a deduction under section 355-305 or 355-520 for an asset ' s decline in value, the arm ' s length rules in Division 40 apply as part of the notional application of that Division under that section.