INCOME TAX ASSESSMENT ACT 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-45 - RULES FOR PARTICULAR INDUSTRIES AND OCCUPATIONS  

Division 355 - Research and Development  

Subdivision 355-E - Notional deductions for decline in value of depreciating assets used for R&D activities  

SECTION 355-315   Balancing adjustments - assets only used for R&D activities  

355-315(1)  
This section applies to an *R&D entity if:


(a) a *balancing adjustment event happens in an income year (the event year ) for an asset *held by the R&D entity; and


(b) the R&D entity cannot deduct an amount under section 40-25, as that section applies apart from:


(i) this Division; and

(ii) former section 73BC of the Income Tax Assessment Act 1936;
for the asset for an income year; and


(c) the R&D entity is entitled under section 355-100 to *tax offsets for one or more income years for deductions (the R&D deductions ) under section 355-305 for the asset; and


(d) the entity is registered under section 27A of the Industry Research and Development Act 1986 for one or more *R&D activities for the event year; and


(e) if Division 40 applied with the changes described in section 355-310:


(i) the entity could deduct for the event year an amount under subsection 40-285(2) for the asset and the balancing adjustment event; or

(ii) an amount would be included in the entity's assessable income for the event year under subsection 40-285(1) for the asset and the balancing adjustment event.
Notional deduction

355-315(2)  
If the *R&D entity could deduct for the event year an amount under subsection 40-285(2) for the asset and the event if Division 40 applied as described in paragraph (1)(e), the R&D entity can deduct that amount for the event year. Amount to be included in assessable income

355-315(3)  
If an amount (the section 40-285 amount ) would be included in the *R&D entity's assessable income for the event year under subsection 40-285(1) for the asset and the event if Division 40 applied as described in paragraph (1)(e), the sum of that amount and the following amount is included in the R&D entity's assessable income for the event year:


Adjusted section 40-285 amount × 1
3

where:

adjusted section 40-285 amount
means so much of the section 40-285 amount as does not exceed the total decline in value.

total decline in value
means the asset's *cost, less its *adjustable value, worked out under Division 40 as it applies as described in paragraph (1)(e).


View surrounding sectionsView surrounding sectionsBack to top


This information is provided by CCH Australia Limited Link opens in new window. View the disclaimer and notice of copyright.