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-D - Notional deductions for R & D expenditure  

SECTION 355-210   Conditions for R & D activities  

355-210(1)  
An *R & D activity covered by one or more of the following paragraphs is an activity to which this section applies:


(a) the R & D activity is conducted for the *R & D entity solely within Australia;


(b) if the R & D entity is a body corporate carrying on business through a permanent establishment (as described in subsection 355-35(2) ) - the R & D activity is conducted:


(i) for the body corporate; but

(ii) not for the purposes of that permanent establishment;
and the conditions in section 355-215 (activities conducted for a body corporate by its permanent establishment) are met for the R & D activity;


(c) the R & D activity is conducted for one or more foreign residents who are each:


(i) incorporated under a *foreign law; and

(ii) a resident of a foreign country for the purposes of an agreement of a kind described in subsection 355-35(2) ;
and the conditions in section 355-220 (activities conducted for a foreign entity) are met for the R & D activity;


(d) the R & D activity is:


(i) conducted for the R & D entity solely outside Australia; and

(ii) covered by a finding in force under paragraph 28C(1)(a) of the Industry Research and Development Act 1986 ;


(e) the R & D activity consists of several parts, with:


(i) some parts being conducted for the R & D entity solely within Australia; and

(ii) the other parts being conducted for the R & D entity outside Australia while covered by a finding in force under paragraph 28C(1)(a) of the Industry Research and Development Act 1986 .
Note:

An activity can be covered by a finding under paragraph 28C(1)(a) of the Industry Research and Development Act 1986 if the activity cannot be conducted in Australia.

355-210(2)  
However, an *R & D activity is not an activity to which this section applies if the activity is conducted, to a significant extent, for one or more other entities not covered by any paragraph of subsection (1).

Note:

An entity would not be covered by, for example, paragraph (1)(c) if the conditions in section 355-220 were not met for the R & D activity in relation to that entity.


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