Tax Laws Amendment (2004 Measures No. 3) Act 2004 (105 of 2004)
Schedule 1 Venture capital
Part 1 Tax amendments
Income Tax Assessment Act 1997
7 Subsection 118-425(3)
Repeal the subsection, substitute:
Predominant activity
(3) The company must satisfy at least 2 of these requirements:
(a) more than 75% of the companys assets (determined by value) must be used primarily in activities that are not ineligible activities mentioned in subsection (13);
(b) more than 75% of the companys employees must be engaged primarily in activities that are not ineligible activities mentioned in subsection (13);
(c) more than 75% of the companys total assessable income, *exempt income and *non-assessable non-exempt income must come from activities that are not ineligible activities mentioned in subsection (13).
Note 1: This requirement is ongoing. It is not limited to the circumstances at the time the investment was made.
Note 2: See subsection (10) for the value of assets.
Note 3: A company that fails to meet at least 2 of the requirements can still be eligible if the PDF Board determines that the companys primary activity is not ineligible and the failure is temporary: see subsection (14).
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