Commonwealth Numbered Acts Commonwealth Numbered ActsIndustry Research and Development Act 1986
1 After Part II
Insert:
Part III -- Functions relating to the R&D tax offset
The objects of this Part are:
(a) to provide integrity for the working out of tax offsets under Division 355 (about R&D) of the Income Tax Assessment Act 1997 ; and
(b) to increase certainty through findings about matters relevant to the working out of those tax offsets; and
(c) to improve access for small and medium R&D entities to quality research services by maintaining a register of research service providers.
Note: The integrity mentioned in paragraph (a) is provided, for example, by:
(a) the Board registering entities seeking these tax offsets; and
(b) the Board conducting compliance checks on those entities.
The following is a simplified outline of this Part:
• The Board may, on application by an R&D entity, register the R&D entity for R&D activities. This registration is needed before the R&D entity can be entitled to a tax offset (an R&D tax offset ) under Division 355 of the Income Tax Assessment Act 1997 for the R&D activities.
• The R&D entity can seek an advance finding to get early notice about whether an activity is considered to be an R&D activity.
• The R&D entity can seek a finding that an activity cannot be conducted in Australia. The finding is needed before expenditure incurred on the activity can count towards an R&D tax offset.
• The Board may register entities as research service providers capable of providing research services to R&D entities.
• Internal and external review can be sought for certain decisions under this Part.
Division 2 -- Registering for the R&D tax offset
The following is a simplified outline of this Division:
• The Board may register an R&D entity for R&D activities conducted during an income year.
• The Board may make findings about the nature of an R&D entity's activities both before and after registration. This includes findings made on application by the R&D entity after registration.
• These findings bind the Commissioner for the purposes of any entitlement of the R&D entity to a tax offset under Division 355 of the Income Tax Assessment Act 1997 for the activities.
• The Board will register an R&D entity's activities consistently with any findings made about the entity's application. Any findings made about these activities after registration will, if necessary, automatically vary the entity's registration.
• Registrations can also be varied and revoked.
Subdivision B -- Registering R&D entities for R&D activities
27A Registering R&D entities for R&D activities
(1) The Board must, on application by an R&D entity, decide whether to register or refuse to register the entity for either or both of the following for an income year:
(a) one or more specified activities as core R&D activities conducted during the income year;
(b) one or more specified activities as supporting R&D activities conducted during the income year.
Note 1: A decision under this subsection is reviewable (see Division 5).
Note 2: For requirements of applications, see section 27D.
(2) If the Board decides under subsection (1) to register the R&D entity, the Board must do so consistently with:
(a) any findings already in force under subsection 27B(1) in relation to the application; and
(b) any findings already in force under subsection 28A(1) (advance findings about the nature of activities) in relation to the R&D entity.
(3) For each activity registered under subsection (1) as a supporting R&D activity for an R&D entity for an income year, the registration is to also specify:
(a) one or more activities as the corresponding core R&D activities; and
(b) if any of those activities specified as a core R&D activity is not registered under paragraph (1)(a) for the R&D entity for the income year--each income year for which that core R&D activity:
(i) was registered under paragraph (1)(a) for the R&D entity; or
(ii) is proposed to be registered under paragraph (1)(a) for the R&D entity.
27B Findings about applications for registration
(1) The Board may make one or more findings to the following effect when considering an R&D entity's application for the purposes of subsection 27A(1):
(a) that all or part of an activity mentioned in the application was a core R&D activity conducted during the income year;
(b) that all or part of an activity mentioned in the application was not an activity of a kind covered by paragraph (a);
(c) that all or part of an activity mentioned in the application was a supporting R&D activity conducted:
(i) during the income year; and
(ii) in relation to one or more specified core R&D activities for which the entity has been or could be registered under section 27A for an income year;
(d) that all or part of an activity mentioned in the application was not an activity of a kind covered by paragraph (c).
Note 1: A finding is reviewable (see Division 5).
Note 2: The Board could make a finding under paragraph (b) if, for example, the Board has insufficient information to make a finding under paragraph (a). Similarly, the Board could make a finding under paragraph (d) if it has insufficient information to make a finding under paragraph (c).
Note 3: The Board may also make findings after registration (see subsection 27J(1)).
(2) If the Board makes a finding under subsection (1) in relation to the R&D entity's application, the Board may specify in the finding the times to which the finding relates.
Example: A finding under paragraph (1)(a) could specify the times during the income year that an activity was a core R&D activity.
(3) This section has effect subject to section 32B (findings cannot be inconsistent with any earlier findings).
27C Notice of decision about registration
(1) The Board must notify an applicant in writing of the Board's decision under subsection 27A(1) about the application.
(2) The notice must include a certificate for each finding (if any) made under subsection 27B(1) for the application. The certificate must set out:
(a) a description of the finding; and
(b) the Board's reasons for the finding; and
(c) the activity affected by the finding; and
(d) the matters (if any) specified in regulations made for the purposes of this paragraph.
The notice and certificate may set out other matters.
Note: The notice could also mention the applicant's right to have the finding reviewed under Division 5 (see section 30B).
(3) The Board must give the Commissioner a copy of the notice if the notice includes one or more certificates.
(4) A failure to comply with this section does not affect the validity of the decision or finding.
Subdivision C -- Applying to register R&D activities
27D Applying to register R&D activities
An application to register activities under section 27A for an income year must be:
(a) in the approved form; and
(b) accompanied by the fee (if any) specified in regulations made under section 48A for the purposes of this section; and
(c) made within:
(i) 10 months after the end of the income year; or
(ii) a further period allowed by the Board in accordance with the decision-making principles.
Note 1: A refusal to allow a further period is reviewable (see Division 5).
Note 2: Section 32 deals with approved forms.
Note 3: Section 32A deals with the decision-making principles.
27E Board may request further information
(1) The Board may request the applicant in writing to give specified information, or specified kinds of information, to the Board about the application.
(2) The request may be for the information or kinds of information to be given within:
(a) 30 days after the request was made; or
(b) a further period allowed by the Board in accordance with the decision-making principles.
Note 1: A refusal to allow a further period is reviewable (see Division 5).
Note 2: Section 32A deals with the decision-making principles.
Note 3: A failure by the entity to give the information may result in a finding under paragraph 27B(1)(b) or (d).
(3) The request may be for the information or kinds of information to be given in the approved form.
Note: Section 32 deals with approved forms.
(4) Subsections (2) and (3) do not limit subsection (1).
Subdivision D -- Examining registrations
(1) The Board may conduct one or more examinations of all or part of an R&D entity's registration under section 27A for an income year for the purposes of making one or more findings under subsection 27J(1).
Note: A finding under subsection 27J(1) will support the entity's registration, or cause the variation of that registration.
(2) The Board may examine an R&D entity's registration on its own initiative.
(3) The Board must examine an R&D entity's registration if:
(a) requested by the Commissioner; or
(b) the R&D entity has applied for one or more findings under subsection 27J(1) about the registration.
Note: A finding under subsection 27J(1) can only bind the Commissioner for the purposes of the R&D entity's income tax assessment for the income year if the finding is made within 4 years after the end of the income year (see subsection 355- 705(1) of the Income Tax Assessment Act 1997 ) .
(4) If the R&D entity applies for a finding under subsection 27J(1) about the registration, the Board must:
(a) make one or more findings under subsection 27J(1) about the registration; or
(b) if justified in accordance with the decision-making principles--refuse to make a finding under subsection 27J(1) about the registration.
Note 1: The Board may make a finding that differs from that sought by the R&D entity.
Note 2: A finding, or a refusal to make a finding, is reviewable (see Division 5).
Note 3: Section 32A deals with the decision-making principles.
An application for one or more findings under subsection 27J(1) must be:
(a) in the approved form; and
(b) accompanied by the fee (if any) specified in regulations made under section 48A for the purposes of this section.
Note 1: An application can seek findings for several activities.
Note 2: Section 32 deals with approved forms.
27H Board may request information during an examination
(1) When examining an R&D entity's registration, the Board may request the entity in writing to give specified information, or specified kinds of information, to the Board about the entity's registration.
(2) The request may be for the information or kinds of information to be given within:
(a) 30 days after the request was made; or
(b) a further period allowed by the Board in accordance with the decision-making principles.
Note 1: A refusal to allow a further period is reviewable (see Division 5).
Note 2: Section 32A deals with the decision-making principles.
Note 3: A failure by the entity to give the information may result in a finding under paragraph 27J(1)(b) or (d).
(3) The request may be for the information or kinds of information to be given in the approved form.
Note: Section 32 deals with approved forms.
(4) Subsections (2) and (3) do not limit subsection (1).
27J Findings about a registration
(1) The Board may make one or more findings to the following effect about an R&D entity's registration under section 27A for an income year (the registration year ):
(a) that all or part of a registered activity was a core R&D activity conducted during the registration year;
(b) that all or part of a registered activity was not an activity of a kind covered by paragraph (a);
(c) that all or part of a registered activity was a supporting R&D activity conducted during the registration year and in relation to:
(i) one or more specified registered core R&D activities; or
(ii) one or more specified core R&D activities for which the entity has been registered in an earlier income year; or
(iii) one or more specified core R&D activities yet to be conducted for which the entity could be registered in the registration year if those activities were conducted during the registration year; or
(iv) several specified core R&D activities, each covered by subparagraph (i), (ii) or (iii);
(d) that all or part of a registered activity was not an activity of a kind covered by paragraph (c).
Note 1: A finding is reviewable (see Division 5).
Note 2: The Board could make a finding under paragraph (b) if, for example, the Board has insufficient information to make a finding under paragraph (a). Similarly, the Board could make a finding under paragraph (d) if it has insufficient information to make a finding under paragraph (c).
(2) If the Board makes a finding under subsection (1) in relation to the R&D entity's registration, the Board may specify in the finding the times to which the finding relates.
Example: A finding under paragraph (1)(a) could specify the times during the registration year that a registered activity was a core R&D activity.
(3) This section has effect subject to section 32B (findings cannot be inconsistent with any earlier findings).
27K Notice of findings or of decisions refusing to make findings
(1) The Board must notify the R&D entity, and the Commissioner, in writing of any findings under subsection 27J(1) about the entity's registration under section 27A.
(2) The notice must include a certificate for each finding. The certificate must set out:
(a) a description of the finding; and
(b) the Board's reasons for the finding; and
(c) the registered activity affected by the finding; and
(d) the effect of the finding on the entity's registration; and
(e) the matters (if any) specified in regulations made for the purposes of this paragraph.
The notice and certificate may set out other matters.
Note 1: For the effect of the finding on the entity's registration, see section 27L (about automatic variations to registrations).
Note 2: The notice could also mention the applicant's right to have the finding reviewed under Division 5 (see section 30B).
(3) The Board must notify the R&D entity in writing of any decision under paragraph 27F(4)(b) refusing to make a finding under subsection 27J(1) in response to an application under section 27G by the R&D entity.
(4) A failure to comply with this section does not affect the validity of a finding or decision.
27L Automatic variations so registration is consistent with findings
(1) If an R&D entity is registered under section 27A for an income year, then while a finding is in force:
(a) under subsection 27B(1) in relation to the application for the registration; or
(b) under subsection 27J(1) in relation to the registration;
the registration is taken always to have existed in a form consistent with the finding.
Note 1: This subsection will cease to apply if the finding is set aside on review (see Division 5).
Note 2: A finding has no effect to the extent of any inconsistency with a finding already in force under this Part in relation to the R&D entity (see section 32B).
(2) If:
(a) a finding under subsection 28A(1) (advance findings about the nature of activities) comes into force for an R&D entity about an activity conducted during an income year; and
(b) the R&D entity is later registered under section 27A for the activity for the income year;
then, after registration and while the finding is in force, the registration is taken to exist in a form consistent with the finding.
Note 1: This subsection will cease to apply if the finding is set aside on review (see Division 5).
Note 2: A finding has no effect to the extent of any inconsistency with a finding already in force under this Part in relation to the R&D entity (see section 32B).
(3) This section has effect for the purposes of this Act and the Income Tax Assessment Act 1997 .
27M Varying registrations on application
(1) The Board may, by notice in writing given to an R&D entity, vary the entity's registration under section 27A for an income year if:
(a) the entity applies for the variation; and
(b) the variation is consistent with the Board's findings (if any) in force under this Part in relation to the R&D entity; and
(c) making the variation is justified in accordance with the decision-making principles.
Note 1: A decision not to vary is reviewable (see Division 5).
Note 2: Section 32A deals with the decision-making principles.
(2) An application for a variation must be:
(a) in the approved form; and
(b) accompanied by the fee (if any) specified in regulations made under section 48A for the purposes of this section.
Note: Section 32 deals with approved forms.
(3) Section 27E applies to an application under this section in a way corresponding to the way that section applies to an application under section 27D.
Note: This means the Board may request further information about the application for variation.
(4) For the purposes of this Act and the Income Tax Assessment Act 1997 , the effect of a variation is that the entity's registration under section 27A for the income year is taken always to have existed as varied.
(1) The Board may, by notice in writing given to an entity, revoke the entity's registration under section 27A for an income year if the Board is satisfied that the entity was not an R&D entity at any time when an activity covered by the registration was conducted during the income year.
Note: A decision to revoke under this subsection is reviewable (see Division 5).
(2) The Board may, by notice in writing given to an R&D entity, revoke the entity's registration under section 27A for an income year if the entity requests the Board to do so.
(3) A request for a revocation under subsection (2) must be:
(a) in the approved form; and
(b) accompanied by the fee (if any) specified in regulations made under section 48A for the purposes of this section.
Note: Section 32 deals with approved forms.
(4) For the purposes of this Act and the Income Tax Assessment Act 1997 , the effect of a revocation under this section is that the entity is taken never to have been registered under section 27A for the income year.
Note: This subsection will cease to apply if a revocation under subsection (1) is set aside on review (see Division 5).
(5) The Board must notify the Commissioner of a revocation under this section.
The following is a simplified outline of this Division:
• An R&D entity can seek a finding (an advance finding ) about whether an activity is an R&D activity.
• An advance finding binds the Commissioner for the purpose of working out tax offsets ( R&D tax offset s) under Division 355 of the Income Tax Assessment Act 1997 .
• An R&D entity can seek a finding that an activity cannot be conducted in Australia.
• An R&D tax offset will only be available for expenditure incurred on an activity conducted outside Australia if a finding that the activity cannot be conducted in Australia has come into force.
• The Board may also make a finding about whether particular technology is core technology for R&D activities.
• An effect of a finding that the technology is core technology for the R&D activities is that an R&D tax offset will not be available for expenditure incurred in acquiring, or in acquiring the right to use, the technology for the R&D activities.
Subdivision B -- Advance findings about the nature of activities
28A Advance findings about the nature of activities
(1) The Board must, on application by an R&D entity for a finding under this subsection about an activity, do one or more of the following:
(a) find that all or part of the activity is a core R&D activity;
(b) find that all or part of the activity is a supporting R&D activity in relation to one or more specified core R&D activities for which the entity has been or could be registered under section 27A for an income year;
(c) make a finding to the effect that all or part of the activity is neither:
(i) a core R&D activity; nor
(ii) a supporting R&D activity of a kind covered by paragraph (b);
(d) if justified in accordance with the decision-making principles--refuse to make a finding about all or part of the activity.
Note 1: A finding, or a refusal to make a finding, is reviewable (see Division 5).
Note 2: For requirements of applications, see section 28G.
Note 3: A finding binds the Commissioner for the purposes of income tax assessments for certain income years (see subsections 355 - 705(2) and (3) of the Income Tax Assessment Act 1997 ).
Note 4: Section 32A deals with the decision-making principles.
(2) The Board must not make a finding under subsection (1) about an activity unless the Board is satisfied that the activity:
(a) is being conducted, or has been completed, during the income year in which the application is made; or
(b) is yet to be conducted, but that it is reasonable to expect that the activity will be conducted in any or all of the following income years:
(i) the income year in which the application is made;
(ii) either of the next 2 income years.
(3) If the Board makes a finding under subsection (1) about an activity that is being conducted, or has been completed, during the income year in which the application is made, the Board may specify in the finding the times to which the finding relates.
(4) This section has effect subject to section 32B (findings cannot be inconsistent with any earlier findings).
28B Applications made on behalf of R&D entities
(1) An application for a finding under subsection 28A(1) may be made on behalf of an R&D entity by an entity who:
(a) is specified in regulations made for the purposes of this subsection; and
(b) is acting with the R&D entity's written consent.
The application is taken to be made by the R&D entity.
Note: For specification by class, see subsection 13(3) of the Legislative Instruments Act 2003 .
(2) If:
(a) an entity could, under subsection (1), make an application on behalf of more than one R&D entity for the same finding for the same activity; and
(b) the entity applies (the joint application ) under subsection 28G(2) for the finding on behalf of those R&D entities;
the joint application is taken to be a separate application under subsection 28G(1) for the finding by each of those R&D entities.
Subdivision C -- Findings about activities to be conducted outside Australia
28C Findings about activities to be conducted outside Australia
(1) The Board must, on application by an R&D entity for a finding under this subsection about an activity, do one or more of the following:
(a) find that all or part of the activity is an activity (the overseas activity ) that meets the conditions in section 28D;
(b) find that all or part of the activity is not an activity that meets the conditions in section 28D;
(c) if justified in accordance with the decision-making principles--refuse to make a finding about all or part of the activity.
Note 1: A finding, or a refusal to make a finding, is reviewable (see Division 5).
Note 2: For requirements of applications, see section 28G.
Note 3: An effect of a finding under paragraph (a) is that a tax offset may be available for expenditure incurred on the overseas activity after the finding comes into force (see Division 355 of the Income Tax Assessment Act 1997 , in particular paragraphs 355-210(1)(d) and (e) of that Act).
Note 4: Section 32A deals with the decision-making principles.
(2) For the purposes of this Act and the Income Tax Assessment Act 1997 , a finding under subsection (1) comes into force at the start of the income year in which the application for the finding is made.
(3) This section has effect subject to section 32B (findings cannot be inconsistent with any earlier findings).
28D Conditions for a finding that an overseas activity cannot be conducted in Australia etc.
Must be an R&D activity
(1) The first condition is that the overseas activity is covered by a finding under paragraph 28A(1)(a) or (b) (findings that activities are R&D activities).
Must have significant scientific link to Australian core activities
(2) The second condition is that the overseas activity has a significant scientific link to one or more core R&D activities (the Australian core activities ):
(a) that are conducted or to be conducted solely within Australia or an external Territory; and
(b) that:
(i) are registered under section 27A for the R&D entity for an income year; or
(ii) are reasonably likely to be conducted and be registered under section 27A for the R&D entity for an income year.
(3) The overseas activity has a significant scientific link to the Australian core activities if:
(a) the Australian core activities cannot be completed without the overseas activity being conducted; and
(b) the conditions (if any) specified in regulations made for the purposes of this subsection are met.
Must be unable to be conducted within Australia etc.
(4) The third condition is that the overseas activity cannot be conducted solely in Australia or the external Territories because:
(a) conducting it requires access to a facility, expertise or equipment not available in Australia or the external Territories; or
(b) conducting it in Australia or the external Territories would contravene a law relating to quarantine; or
(c) conducting it requires access to a population (of living things) not available in Australia or the external Territories; or
(d) conducting it requires access to a geographical or geological feature not available in Australia or the external Territories; or
(e) it meets a condition (if any) specified in regulations made for the purposes of this subsection.
Expenditure must be less than that incurred on Australian core activities
(5) The fourth condition is that the total actual and reasonably anticipated expenditure of any entity in all income years on:
(a) the overseas activity; and
(b) each other activity (if any) conducted wholly or partly outside Australia and the external Territories that has a significant scientific link to the Australian core activities;
is less than the total actual and reasonably anticipated expenditure of any entity in all income years on:
(c) the Australian core activities; and
(d) activities conducted solely within Australia and the external Territories that are supporting R&D activities in relation to the Australian core activities.
Subdivision D -- Findings about whether technology is core technology
28E Findings about whether technology is core technology
(1) If an R&D entity has acquired, or has acquired the right to use, particular technology wholly or partly for the purposes of one or more R&D activities conducted, or to be conducted, during one or more income years, the Board may:
(a) find that the technology is core technology for the R&D activities; or
(b) find that the technology is not core technology for the R&D activities; or
(c) if justified in accordance with the decision-making principles--refuse to make a finding about the technology and the R&D activities.
Note 1: A finding, or a refusal to make a finding, is reviewable (see Division 5).
Note 2: A finding under paragraph (a) means that a tax offset will not be available for expenditure incurred in acquiring, or in acquiring the right to use, the technology for the R&D activities (see subsection 355- 225(2) of the Income Tax Assessment Act 1997 ).
Note 3: Section 32A deals with the decision-making principles.
(2) Particular technology is core technology for one or more R&D activities if:
(a) a purpose of the R&D activities was or is:
(i) to obtain new knowledge based on that technology; or
(ii) to create new or improved materials, products, devices, processes, techniques or services to be based on that technology; or
(b) the R&D activities were or are an extension, continuation, development or completion of the activities that produced that technology.
(3) The Board must make a finding under paragraph (1)(a) or (b) if requested by the Commissioner to make a finding under this section.
(4) In addition to subsection (3), the Board:
(a) may make a finding under subsection (1) on its own initiative; and
(b) must make a decision under subsection (1) if the R&D entity applies for a finding under this section.
Note: For requirements of applications, see section 28G.
(5) This section has effect subject to section 32B (findings cannot be inconsistent with any earlier findings).
Subdivision E -- Matters relevant to findings under this Division
28F Notice of decision about findings
(1) The Board must notify an applicant in writing of each of the Board's decisions under subsection 28A(1) or 28C(1) about the application.
(2) The Board must notify an R&D entity in writing of each of the Board's decisions under subsection 28E(1) that relates to the R&D entity.
(3) A notice under subsection (1) or (2) must include a certificate for each finding (if any) to which the decision relates. The certificate must set out:
(a) a description of the finding; and
(b) the Board's reasons for the finding; and
(c) a description of the activity affected by the finding; and
(d) for a finding under subsection 28E(1)--a description of the technology affected by the finding; and
(e) the matters (if any) specified in regulations made for the purposes of this paragraph.
The notice and certificate may set out other matters.
Note: The notice could also mention the applicant's right to have the finding reviewed under Division 5 (see section 30B).
(4) The Board must give the Commissioner a copy of the notice if the notice includes one or more certificates.
(5) A failure to comply with this section does not affect the validity of a decision or finding.
Applications for findings
(1) An application for one or more findings under this Division must be:
(a) in the approved form; and
(b) accompanied by the fee (if any) specified in regulations made under section 48A for the purposes of this subsection.
Note 1: An application can seek findings for several activities.
Note 2: Section 32 deals with approved forms.
Joint applications for identical advance findings
(2) An application for identical findings under subsection 28A(1) on behalf of several R&D entities must be:
(a) in the approved form; and
(b) accompanied by the fee (if any) specified in regulations made under section 48A for the purposes of this subsection.
Note: The application is taken to be a separate application under subsection (1) of this section for the finding by each of those R&D entities (see subsection 28B(2)).
28H Board may request further information
(1) The Board may request in writing:
(a) for an application taken to be made by an R&D entity because of section 28B--the entity that acted on behalf of the R&D entity in relation to the application; or
(b) otherwise--the applicant;
to give specified information, or specified kinds of information, to the Board about the application.
(2) The request may be for the information or kinds of information to be given within:
(a) 30 days after the request was made; or
(b) a further period allowed by the Board in accordance with the decision-making principles.
Note 1: A refusal to allow a further period is reviewable (see Division 5).
Note 2: Section 32A deals with the decision-making principles.
Note 3: A failure by the entity to give the information may result in a refusal to make the finding.
(3) The request may be for the information or kinds of information to be given in the approved form.
Note: Section 32 deals with approved forms.
(4) Subsections (2) and (3) do not limit subsection (1).
Division 4 -- Research service providers
The following is a simplified outline of this Division:
• The Board may register entities as research service providers capable of providing research services to R&D entities.
• Near the end of each financial year, registered research service providers will be asked if they want their registrations to continue for the next financial year.
• Registrations can be varied and revoked.
• Details of registrations are set out in a register available on the internet.
Subdivision B -- Registering research service providers
29A Registering research service providers
(1) The Board must, on application by an entity, decide whether to register or refuse to register the entity as a research service provider capable of providing services in one or more specified research fields to R&D entities registered under section 27A.
Note: A decision under this subsection is reviewable (see Division 5).
(2) The Board must not register the entity under subsection (1) unless the Board is satisfied that the entity meets the criteria specified in regulations made for the purposes of this subsection.
(3) A registration under this section is subject to the conditions (if any) specified in regulations made for the purposes of this subsection.
Subdivision C -- Applying for registration
An application to be registered under section 29A must be:
(a) in the approved form; and
(b) accompanied by the fee (if any) specified in regulations made under section 48A for the purposes of this section.
Note: Section 32 deals with approved forms.
29C Board may request further information about an application
(1) The Board may request the applicant in writing to give specified information, or specified kinds of information, to the Board about the application.
(2) The request may be for the information or kinds of information to be given within 30 days after the request was made.
(3) The request may be for the information or kinds of information to be given in the approved form.
Note: Section 32 deals with approved forms.
(4) Subsections (2) and (3) do not limit subsection (1).
(5) The Board may refuse to consider the application if the applicant fails to give the information within:
(a) the 30 days referred to in subsection (2); or
(b) a further period allowed by the Board in accordance with the decision-making principles.
Note 1: A refusal to allow a further period is reviewable (see Division 5).
Note 2: Section 32A deals with the decision-making principles.
29D Board may need to make inquiries about an application
(1) The Board may notify the applicant in writing that the Board:
(a) needs to make inquiries in order to determine whether the applicant meets the criteria for registration referred to in subsection 29A(2); and
(b) requires the applicant to pay the Board a specified amount towards the cost of those inquiries.
(2) The Board may refuse to consider the application until the applicant pays the Board that amount.
(3) An amount specified in a notice under subsection (1) must not exceed the higher of:
(a) $1,000; and
(b) the amount (if any) specified in regulations made for the purposes of this subsection;
and must not be such as to amount to taxation.
Subdivision D -- Varying or revoking registrations
(1) At least 2 months before the end of each financial year, the Board must give each research service provider a notice:
(a) asking the provider if it wishes to continue to be registered under section 29A; and
(b) attaching an approved form to be completed by the provider and returned to the Board if the provider wishes to continue to be registered.
This subsection does not apply to a provider who becomes registered under section 29A in May or June of that financial year.
Note: Section 32 deals with approved forms.
(2) The Board may, by notice in writing given to the provider, revoke the provider's registration under section 29A if the provider does not return the completed form within:
(a) 30 days after the notice under subsection (1) was given; or
(b) a further period allowed by the Board in accordance with the decision-making principles.
Note 1: A decision to revoke under this subsection is reviewable (see Division 5).
Note 2: Section 32A deals with the decision-making principles.
(3) For the purposes of this Act and the Income Tax Assessment Act 1997 , the revocation takes effect at the end of that financial year.
Note: This subsection will cease to apply if the revocation is set aside on review (see Division 5).
29F Varying registrations--on application
(1) The Board may, by notice in writing given to a research service provider, vary the provider's registration under section 29A if:
(a) the provider applies for the variation; and
(b) the Board is satisfied that the provider would still meet the criteria for registration referred to in subsection 29A(2) were the application to be successful.
Note: A refusal to vary is reviewable (see Division 5).
(2) An application for a variation must be:
(a) in the approved form; and
(b) accompanied by the fee (if any) specified in regulations made under section 48A for the purposes of this section.
Note: Section 32 deals with approved forms.
(3) Sections 29C and 29D apply to applications under this section in a way corresponding to the way those sections apply to applications under section 29B.
Note: This means the Board may request further information about the application for variation, and make inquiries about the application for variation.
29G Varying registrations--otherwise than on application
(1) The Board may, by notice in writing given to a research service provider, vary the provider's registration under section 29A so that the provider ceases to be registered to provide services in one or more specified research fields.
Note 1: A decision to vary is reviewable (see Division 5).
Note 2: This subsection will cease to apply if the variation is set aside on review (see Division 5).
(2) The Board may do so if the Board is satisfied that the provider does not meet the criteria for registration referred to in subsection 29A(2) in so far as those criteria relate to those research fields.
(1) The Board may, by notice in writing given to a research service provider, revoke the provider's registration under section 29A if the Board is satisfied:
(a) that the provider has ceased to meet the criteria for registration referred to in subsection 29A(2); or
(b) that the provider has breached a condition, referred to in subsection 29A(3), of the registration.
Note 1: A decision to revoke under this subsection is reviewable (see Division 5).
Note 2: This subsection will cease to apply if the revocation is set aside on review (see Division 5).
Note 3: Revocation can also happen under subsection 29E(2) if the provider does not appropriately indicate that it wishes to continue to be registered for the next financial year.
(2) The Board may, by notice in writing given to a research service provider, revoke the provider's registration under section 29A if the provider requests the Board to do so.
(3) A request for a revocation under subsection (2) must be in the approved form.
Note: Section 32 deals with approved forms.
Subdivision E -- Register of research service providers
29J Register of research service providers
(1) The Board is to make available for inspection on the internet a register that includes details of:
(a) registrations in force under this Division; and
(b) registrations that have been revoked under this Division during the current financial year or the previous financial year.
Note 1: A registration in force under this Division includes the research fields for which the provider is registered.
Note 2: A registration in force under this Division is that registration as varied under section 29F or 29G.
(2) The register is not a legislative instrument.
The following is a simplified outline of this Division:
• An entity affected by a reviewable decision may ask the Board to conduct an internal review of that decision.
• The entity, or another entity affected by the resulting internal review decision, may ask the Administrative Appeals Tribunal to review the internal review decision.
Each of the following decisions of the Board is a reviewable decision :
|
Reviewable decisions |
||
|
Item |
Decision |
Provision under which decision is made |
|
1 |
Registering or refusing to register an entity for activities |
Subsection 27A(1) |
|
2 |
A finding made when considering an application for registration of activities |
Subsection 27B(1) |
|
3 |
Refusing to allow a further period for making an application for registration of activities |
Paragraph 27D(c) |
|
4 |
Refusing to allow a further period for giving further information about an application for registration of activities |
Paragraph 27E(2)(b) |
|
5 |
Refusing to make a finding about a registration of activities |
Paragraph 27F(4)(b) |
|
6 |
Refusing to allow a further period for giving further information about an examination of a registration of activities |
Paragraph 27H(2)(b) |
|
7 |
A finding made about a registration of activities |
Subsection 27J(1) |
|
8 |
Refusing to vary on application a registration of activities |
Subsection 27M(1) |
|
9 |
Refusing to allow a further period for giving further information about an application for variation of a registration of activities |
Paragraph 27E(2)(b), as that paragraph applies because of subsection 27M(3) |
|
10 |
Revoking a registration of activities |
Subsection 27N(1) |
|
11 |
An advance finding, or refusing to make an advance finding, about the nature of an activity |
Subsection 28A(1) |
|
12 |
A finding, or refusing to make a finding, about an activity to be conducted outside Australia |
Subsection 28C(1) |
|
13 |
A finding, or refusing to make a finding, about particular technology |
Subsection 28E(1) |
|
14 |
Refusing to allow a further period for giving further information about an application for: (a) an advance finding about the nature of an activity; or (b) a finding about an activity to be conducted outside Australia; or (c) a finding that technology is core technology |
Paragraph 28H(2)(b) |
|
15 |
Registering or refusing to register an entity as a research service provider |
Subsection 29A(1) |
|
16 |
Refusing to allow a further period for giving further information about an application for registration as a research service provider |
Subsection 29C(3) |
|
17 |
Revoking a research service provider's registration for not returning a completed form about continuing that registration |
Subsection 29E(2) |
|
18 |
Refusing to vary on application a research service provider's registration |
Subsection 29F(1) |
|
19 |
Refusing to allow a further period for giving further information about an application for variation of a research service provider's registration |
Subsection 29C(3), as that subsection applies because of subsection 29F(3) |
|
20 |
Varying a research service provider's registration otherwise than on application |
Subsection 29G(1) |
|
21 |
Revoking a research service provider's registration |
Subsection 29H(1) |
|
22 |
Refusing to allow a further period for making an application for review of a decision |
Subsection 30C(3) |
30B Notice of reviewable decision and internal review rights
(1) When making a reviewable decision relating to an entity, the Board must give written notice to the entity of the following things:
(a) the making of the decision;
(b) the reasons for the decision;
(c) the entity's right to have the decision reviewed under this Division.
(2) If written notice of any of these things is given to the entity under another provision of this Part, notice of the thing does not have to be given twice.
Note: Other provisions of this Part require notice to be given about decisions covered by item 2, 7 or 11 of the table in section 30A.
(3) A failure to comply with this section does not affect the validity of the decision.
30C Applications for internal review of reviewable decisions
Applications by affected entities
(1) An application for review of a reviewable decision may be made by or on behalf of any entity whose interests are affected by the reviewable decision.
(2) An application under subsection (1) must be in the approved form.
Note: Section 32 deals with approved forms.
(3) An application under subsection (1) for review of a reviewable decision must be made within:
(a) 28 days after the entity to which the decision relates is notified of the decision under this Part; or
(b) such further period as the Board allows in accordance with the decision-making principles.
Note 1: A refusal to allow a further period is reviewable (see section 30A).
Note 2: Section 32A deals with the decision-making principles.
Applications by Commissioner
(4) The Commissioner may, at any time, apply to the Board for review of a reviewable decision.
30D Internal review of reviewable decisions
(1) After receiving an application for review of a reviewable decision, the Board must review the decision.
Making internal review decisions
(2) After reviewing the reviewable decision, the Board must make a decision (an internal review decision ):
(a) confirming the reviewable decision; or
(b) varying the reviewable decision; or
(c) setting aside the reviewable decision and substituting a new decision.
Note: An internal review decision is reviewable by the Administrative Appeals Tribunal (see section 30E). Under the Administrative Appeals Tribunal Act 1975 , notice of the internal review decision must be given to any person whose interests are affected by the decision.
Deemed internal review decisions
(3) If the Board does not make a decision under subsection (2) before the end of the period of 90 days after the day on which the Board received the application for review, the Board is taken, at the end of that period, to have made a decision (also an internal review decision ) confirming the reviewable decision.
Note: Under the Administrative Appeals Tribunal Act 1975 , notice must be given to any person whose interests are affected by the internal review decision taken to be made under this subsection.
(4) However, an internal review decision (the deemed decision ) is taken not to have been made under subsection (3) if:
(a) after the end of the period referred to in that subsection, the Board makes a decision under subsection (2) about the applicable reviewable decision; and
(b) an application has yet to be made under section 30E to the Administrative Appeals Tribunal for review of the deemed decision.
Matters relevant to all internal review decisions
(5) For the purposes of this Act and the Income Tax Assessment Act 1997 , an internal review decision takes effect on the day on which the reviewable decision took effect.
(6) The Board must notify the Commissioner in writing of:
(a) the making of an internal review decision; and
(b) the reasons for that decision.
30E External review by AAT of internal review decisions
(1) Application may be made to the Administrative Appeals Tribunal for review of an internal review decision of the Board.
(2) Subsection 43(6) of the Administrative Appeals Tribunal Act 1975 has effect for the purposes of this Act and the Income Tax Assessment Act 1997 for:
(a) an internal review decision as varied by the Tribunal under section 43 of the Administrative Appeals Tribunal Act 1975 ; or
(b) a decision made by the Tribunal under that section in substitution for an internal review decision.
Note: This means that the varied or substituted decision takes effect from the day on which the reviewable decision took effect (see subsection 30D(5)).
(3) If an internal review decision is taken to be made under subsection 30D(3), section 29 of the Administrative Appeals Tribunal Act 1975 applies as if:
(a) paragraph 29(1)(d) of that Act applied to the internal review decision; and
(b) the prescribed time for the purposes of that paragraph were the end of the period of 28 days starting on the day on which the internal review decision is taken to be made.
(4) Despite section 35 of the Administrative Appeals Tribunal Act 1975 :
(a) hearings of proceedings for review of an internal review decision are to be held in private; and
(b) during the proceedings, the Tribunal may, by order:
(i) give directions as to the persons who may be present during all or part of a hearing of the proceedings; and
(ii) give directions of a kind mentioned in paragraph 35(2)(aa), (b) or (c) of that Act.
Division 6 -- Consolidated groups and MEC groups
31 Registrations and findings not effective for subsidiary members for group R&D activities
(1) An R&D entity's registration under section 27A for an income year has no effect to the extent that the registration is for an activity conducted during a period that the R&D entity is a subsidiary member of a consolidated group or MEC group, of which the head company is an R&D entity.
Example: If an activity is conducted by the R&D entity during all of an income year, and part way through the income year the R&D entity becomes a subsidiary member of a consolidated group:
(a) the R&D entity can apply to be registered for the activity for the income year, and that registration will be effective in respect of the first part of the income year; and
(b) the head company of the group can apply to be registered for the activity for the income year in respect of the second part of the income year.
(2) If:
(a) a finding is made under this Part on application by an R&D entity that is a subsidiary member of a consolidated group or MEC group; and
(b) the head company of the group is also an R&D entity;
the finding has no effect to the extent that the finding is for an activity conducted during a period that the R&D entity is a subsidiary member of the group.
31A What happens to findings if R&D entity joins a group
(1) If a finding (the actual finding ) under this Part:
(a) is in force for an R&D entity immediately before the time (the joining time ) it becomes a subsidiary member of a consolidated group or MEC group, of which the head company is an R&D entity; and
(b) is for an activity to be conducted wholly or partly after the joining time;
a corresponding finding (the deemed finding ) in the same terms is taken to come into force at the joining time for the head company and the activity.
(2) The deemed finding ceases to be in force if the R&D entity ceases to be a subsidiary member of the group.
(3) The result of any review (see Division 5) of an actual finding is taken to apply in a corresponding way to the deemed finding.
(4) Neither section 28F (notice of decision about findings) nor Division 5 (review) applies to the deemed finding.
31B What happens to findings if R&D entity leaves a group
(1) The consequences in subsection (2) apply if a finding (the group finding ) under this Part:
(a) is for an R&D entity that is the head company of a consolidated group or MEC group; and
(b) is in force immediately before the time (the leaving time ) another R&D entity ceases to be a subsidiary member of the group; and
(c) is for an activity to be conducted by or for the other R&D entity wholly or partly after the leaving time; and
(d) is not a deemed finding.
(2) The consequences are as follows:
(a) a corresponding finding (the continuing finding ) in the same terms is taken to come into force at the leaving time for the other R&D entity and the activity;
(b) everything that happened under this Part before the leaving time in relation to the group finding is taken to have happened in relation to the continuing finding;
(c) the group finding ceases to be in force at the leaving time.
(1) This section applies if a provision of this Part requires a thing to be in the approved form.
(2) To be in the approved form for the provision, the thing must:
(a) be in writing in a form approved by the Board; and
(b) include the information required by the form; and
(c) include any other material (including documents) required by the form.
(3) The Board may approve, in writing, a form for the purposes of paragraph (2)(a). When doing so, the Board must ensure the form requires the production of information, or other material (including documents), specified in regulations made for the purposes of this subsection.
Note: For specification by class, see subsection 13(3) of the Legislative Instruments Act 2003 .
32A Decision-making principles
The Minister may, by legislative instrument, make principles (the decision-making principles ) that the Board must comply with when deciding the following:
(a) whether to allow a thing to be given under this Part within a further period than that specified in this Part;
(b) whether refusing to make a finding sought under this Part is justified;
(c) whether making a variation sought under section 27M is justified.
32B General rules about findings under this Part
(1) A finding made under this Part in relation to an R&D entity has no effect to the extent of any inconsistency with a finding already in force under this Part in relation to the R&D entity.
Example: A finding under subsection 27J(1) in relation to an R&D entity's registration has no effect to the extent of any inconsistency with:
(a) a finding already in force under that subsection in relation to that registration; or
(b) a finding already in force under subsection 27B(1) in relation to the application for that registration; or
(c) a finding already in force under subsection 28A(1) (advance findings about the nature of activities) in relation to the R&D entity.
(2) Subsection 33(3) of the Acts Interpretation Act 1901 does not apply to the power to make a finding under this Part.
Note: This means the power to make a finding does not itself include the power to vary or revoke that finding. A finding can only be varied or revoked on review under Division 5.
32C Alternative constitutional basis
(1) Without limiting its effect apart from this subsection, this Part also has the effect it would have if:
(a) subsection (2) had not been enacted; and
(b) each reference in this Part to an R&D entity were, by express provision, confined to an R&D entity that:
(i) is a constitutional corporation; or
(ii) has its registered office (within the meaning of the Corporations Act 2001 ) or principal place of business (within the meaning of that Act) located in a Territory.
(2) Without limiting its effect apart from this subsection, this Part also has the effect it would have if:
(a) subsection (1) had not been enacted; and
(b) this Part, by express provision, confined applications, registrations, findings and decisions under this Part to be in relation to activities, or parts of activities, conducted or to be conducted:
(i) solely in a Territory; or
(ii) solely outside of Australia; or
(iii) solely in a Territory and outside of Australia; or
(iv) for the dominant purpose of supporting core R&D activities conducted, or to be conducted, solely in a Territory.
Industry Research and Development Act 1986
2 Section 3
Omit "research and development activities", substitute "R&D activities".
3 Subsection 4(1)
Insert:
"approved form" has the meaning given by section 32.
4 Subsection 4(1) (definition of approved research institute )
Repeal the definition.
5 Subsection 4(1)
Insert:
"Commissioner" has the same meaning as in the Income Tax Assessment Act 1997 .
6 Subsection 4(1) (definition of company )
Repeal the definition.
7 Subsection 4(1)
Insert:
"consolidated group" has the same meaning as in the Income Tax Assessment Act 1997 .
8 Subsection 4(1)
Insert:
"constitutional corporation" has the same meaning as in the Income Tax Assessment Act 1997 .
9 Subsection 4(1)
Insert:
core R&D activities has the same meaning as in the Income Tax Assessment Act 1997 .
10 Subsection 4(1)
Insert:
"core technology" has the meaning given by subsection 28E(2).
11 Subsection 4(1)
Insert:
"decision-making principles" has the meaning given by section 32A.
12 Subsection 4(1)
Insert:
"entity" has the same meaning as in the Income Tax Assessment Act 1997 .
13 Subsection 4(1) (definition of finance scheme guidelines )
Repeal the definition.
14 Subsection 4(1)
Insert:
"head company" has the same meaning as in the Income Tax Assessment Act 1997 .
15 Subsection 4(1)
Insert:
"income year" has the same meaning as in the Income Tax Assessment Act 1997 .
16 Subsection 4(1)
Insert:
"internal review decision" has the meaning given by section 30D.
17 Subsection 4(1)
Insert:
"MEC group" has the same meaning as in the Income Tax Assessment Act 1997 .
18 Subsection 4(1)
Insert:
R&D activities has the same meaning as in the Income Tax Assessment Act 1997 .
19 Subsection 4(1)
Insert:
R&D entity has the same meaning as in the Income Tax Assessment Act 1997 .
20 Subsection 4(1) (definition of research and development activities )
Repeal the definition.
21 Subsection 4(1) (definition of researcher )
Repeal the definition, substitute:
"researcher" means an entity that the Board believes is capable of carrying out a project of R&D activities or innovation activities.
22 Subsection 4(1)
Insert:
"research field" means a research field specified in regulations made for the purposes of this definition.
23 Subsection 4(1)
Insert:
"research service provider" means an entity registered under section 29A.
24 Subsection 4(1)
Insert:
"reviewable decision" has the meaning given by section 30A.
25 Subsection 4(1)
Insert:
"significant scientific link" has the meaning given by subsection 28D(3).
26 Subsection 4(1)
Insert:
"subsidiary member" has the same meaning as in the Income Tax Assessment Act 1997 .
27 Subsection 4(1)
Insert:
supporting R&D activities has the same meaning as in the Income Tax Assessment Act 1997 .
28 Subsection 4(2)
Repeal the subsection.
29 Paragraph 7(aa)
Repeal the paragraph.
30 Paragraph 7(ca)
Omit "Commissioner of Taxation", substitute "Commissioner".
31 Subsection 11(1)
Omit "(1)".
32 Subsection 11(2)
Repeal the subsection.
33 Subsection 22(9)
Repeal the subsection.
34 Part IIIA
Repeal the Part.
35 Subparagraph 46(2)(b)(iv)
Omit "research and development activities", substitute "R&D activities".
36 Paragraph 46(2)(ca)
Repeal the paragraph, substitute:
(ca) must set out:
(i) the total number of applications during the year for registration under section 27A for a tax offset under Division 355 of the Income Tax Assessment Act 1997 ; and
(ii) the total amounts of the offsets involved; and
(iii) an analysis of the operation of the R&D tax offset scheme for the year; and
37 At the end of subsection 46(2)
Add:
; and (f) must set out a copy of the register mentioned in section 29J as it exists at the end of the year.
38 Subsection 47(1)
Omit "except for the purposes of this Act, of the Census and Statistics Act 1905 or of the Income Tax Assessment Act 1936 or".
39 Subsection 47(1)
Omit "supply protected information to a person if the supplying", substitute "disclose protected information to a person if disclosing".
40 Subsection 47(2)
Omit "Subsection (1) does not apply to the supply of", substitute "An official to whom this section applies may disclose".
41 After subsection 47(2)
Insert:
(2A) An official to whom this section applies may disclose protected information if the disclosure is made:
(a) in the course of performing a duty or function, or exercising a power, under this Act; or
(b) for the purposes of enabling another person to perform duties or functions, or exercise powers, under this Act; or
(c) for the purposes of enabling a person to perform duties or functions, or exercise powers, under the Census and Statistics Act 1905 or the Income Tax Assessment Act 1997 .
42 Subsection 47(3)
Insert:
"disclose" means divulge or communicate.
43 Section 48A
Repeal the section, substitute:
48A Fees for making applications under Part III
(1) The regulations may specify:
(a) fees for making applications to the Board under Part III; and
(b) a method for indexing the fees.
(2) The fees must not be such as to amount to taxation.