Commonwealth Numbered Acts

TAXATION LAWS AMENDMENT ACT (No. 3) 1997 No. 147 of 1997 - SCHEDULE 11

Schedule 11-Research and development Income Tax Assessment Act 1936 1
Subsection 73B(1) (definition of residual feedstock expenditure)
After "income" (first occurring), insert "in relation to related research and
development activities". 2 Subsection 73B(1) (paragraph (a) of the definition
of residual feedstock expenditure)
After "income", insert "in relation to those activities". 3 Subsection 73B(1)
(paragraph (b) of the definition of residual feedstock expenditure)
After "income", insert "in relation to those activities". 4 Subsection 73B(4H)
(table)
Omit "Annual deduction percentage", substitute "Percentage". 5 Subsection
73B(12B) (formula)
Omit "past". 6 Subsection 73B(12B) (definition of undeducted past expenditure)
Repeal the definition, substitute:
undeducted expenditure means so much of the core technology expenditure
incurred by the company during the current year or previous years of income in
relation to the relevant core technology under contracts entered into at or
after the time referred to in subsection (12) as has not been allowed as a
deduction from the company's assessable income of any of those previous years
of income. 7 Subsection 73B(12B) (paragraph (b) of the definition of current
year core technology adjustment amount)
Omit "73B(27)(c)", substitute "73B(27C)(c)". 8 Subsection 73B(14B)
After "income" (first occurring), insert "in relation to related research and
development activities". 9 After subsection 73B(24A)
Insert:

(24B) Where:

   (a)  a deduction has been allowed or is allowable to an eligible company
        under subsection (15AA) in respect of expenditure incurred in the
        acquisition or construction of a unit of post-23 July 1996 pilot
        plant; and

   (b)  during a year of income, the unit of post-23 July 1996 pilot plant is
        disposed of, lost or destroyed; and

   (c)  the company had used the unit of post-23 July 1996 pilot plant before
        it was disposed of, lost or destroyed exclusively for the purpose of
        the carrying on by or on behalf of the company of research and
        development activities; and

   (d)  no deduction has been allowed or is allowable to the company under
        section 54 in respect of the unit of post-23 July 1996 pilot plant;
        then:

   (e)  in a case where the consideration receivable in respect of the
        disposal, loss or destruction is less than the written-down value of
        the unit of post-23 July 1996 pilot plant:

        (i)    if the aggregate research and development amount in relation to
               the company in relation to the year of income is greater than
               $20,000-the amount ascertained by multiplying the amount by
               which that written-down value exceeds that consideration
               receivable by 1.25; or

        (ii)   if the aggregate research and development amount in relation to
               the company in relation to the year of income is less than or
               equal to $20,000-the amount by which that written-down value
               exceeds that consideration receivable; is allowable as a
               deduction from the assessable income of the company of the year
               of income; or

   (f)  in a case where the consideration receivable in respect of the
        disposal, loss or destruction is greater than the written-down value
        of the unit of post-23 July 1996 pilot plant-so much of the excess as
        does not exceed the difference between the cost of the unit of post-23
        July 1996 pilot plant and the written-down value of the unit of
        post-23 July 1996 pilot plant shall be included in the assessable
        income of the company of the year of income. 10 After subsection
        73B(33B)
Insert:

(33BA) Subject to subsections (33BB) and (33C), if the Board gives the
Commissioner a certificate in relation to a company or companies under
subsection 39PB(6) of the Industry Research and Development  Act 1986 , a
deduction is not allowable under this section in respect of expenditure in
relation to research and development activities referred to in the certificate
that is incurred by that company or any of those companies after the day
stated in the certificate.

(33BB) Subsection (33BA) does not apply to expenditure in relation to research
and development activities in respect of which a company is registered under
section 39J of the Industry Research and  Development Act 1986 . 11 Subsection
73B(33C)
Omit "or (33B)", substitute ", (33B) or (33BA)". 12 Application
The amendments made by items 1 to 11 are taken to have come into effect at 5
pm, by legal time in the Australian Capital Territory, on 23 July 1996.
Taxation Laws Amendment Act (No. 3) 1996 13 Item 38 of Schedule 4
Repeal the item, substitute: 38 Application
The amendments made by this Division do not apply to core technology
expenditure incurred:

   (a)  by a partnership under a contract entered into before 8.30 pm, by
        legal time in the Australian Capital Territory, on 13 December 1996;
        or

   (b)  by eligible companies jointly registered under section 39P of the
        Industry Research and Development Act 1986 where the expenditure is
        incurred under a contract entered into at or after 8.30 pm, by legal
        time in the Australian Capital Territory, on 13 December 1996.