Private ruling: Early-stage innovation company eligibility
Date of advice: 21 November 2025
Published: 5 January 2026
Ruling period: DD MM YYYY to DD MM YYYY
Date scheme commenced: DD MM YYYY

Ruling: Q1: Does the Company meet the criteria of an early stage innovation company (ESIC) under subsection 360-40(1) of the Income Tax Assessment Act 1997 for the period DD MM YYYY to DD MM YYYY? | A1: Yes.

Relevant facts and circumstances: Background facts 1. The company is an Australian proprietary company incorporated in Australia on DD MM YYYY and is registered with the Australian Business Register (ABR). 2. The Company does not have any 100% owned subsidiaries. 3. The Company is not part of an income tax consolidated group. 4. The Company's Directors are Person X, Person Y and Person Z. 5. The Company's registered office and principal place of business is situated in a state or territory in Australia. 6. For each of the relevant financial years, the Company had total assessable income of less than $200,000 and incurred total expenses of less than $1 million. 7. The Company's shares are not publicly listedon any stock exchange. 8. The Company will issue new ordinary shares in the company to eligible investors in the financial year ending 30 June YYYY. Product development 9. The Company is developing a platform (product) to address a need in the particular market. 10. The Company described how its product will solve particular challenges faced by enterprises and simplify and maximise business operations. 11. The Company detailed its product's core innovations and technical differentiation. 12. The core components of the product are currently at different stages of maturity, reflecting the Company's phased approach to development. 13. The Company provided details of its current product development activities. 14. Beyond the immediate development pipeline, the Company is actively investing in research to enhance its product's functionality and adaptability. 15. The Company provided examples of how it will provide an improved service for enterprise customers through its product. Commercialisation strategy 16. The Company's focus is on developing their innovation for commercialisation. 17. The Company has launched its minimum viable product (MVP). 18. The Company has generated revenue from its product in the YYYY financial year and forecasts its revenue to increase to $XX in the YYYY financial year. 19. The Company has a comprehensive go-to-market strategy and clear plans to expand operations to service new sectors and multiple industries globally. 20. The Company's development and commercialisation timeline displays when the Company will raise capital. 21. The Company provided a breakup of how it will utilise funds raised. High growth potential 22. The demand for the service the Company's product provides is accelerating across industries. 23. The Company demonstrated that it is strategically positioned to capitalise on this rapid growth through its scalable product. 24. The Company has determined its Total Addressable Market (TAM) across Australia and its target overseas countries. 25. The Company provided its projected revenue growth, reflecting strong market uptake and the Company's strategic expansion efforts. 26. The Company's revenue model is designed to generate sustainable, high-margin income across multiple streams. The Company provided details of its key revenue components. 27. The Company provided details of its comprehensive go-to-market strategy. Scale up the business 28. The Company demonstrated that it is capable of scaling up its business to fill its high growth potential. 29. The product's infrastructure allows for expansion with minimal operational overhead. 30. The Company described scalability features of its product that will provide the Company with strong economies of scale. 31. The Company detailed how its product is designed to be scalable in enterprise environments through real-world deployments in specific sectors and business. 32. To validate its scalability approach, the Company is conducting and evaluating benchmarking trials. The Company provided details of what is included in these trials. 33. By integrating real-world case studies and rigorous validation frameworks, the Company ensures that its product is scalable, regulatory compliant, and enterprise-ready, positioning it as a leading platform for modern businesses. 34. The Company is led by a highly accomplished executive team with deep expertise in governance, commercialisation and enterprise technology relevant to their product and target market. 35. The Company's leadership team provides a strong foundation for strategic growth, operational scalability, and regulatory compliance. Broader than Local market 36. The Company is leveraging key partnerships and industry alliances to accelerate its entry into new markets and scale its product globally. 37. The Company's international expansion strategy is designed to align with the growing demand for such solutions across industries. 38. The Company's global reach is underpinned by strategic collaborations, enabling it to address market-specific challenges while leveraging a scalable and adaptable ecosystem. 39. The Company has established a network of high-value strategic partnerships to support its global expansion, enhance governance and ensure seamless integration across industries. These collaborations position the Company as a trusted solution provider in enterprise markets worldwide and its federation with existing infrastructure will expedite institutional adoption. Competitive advantages 40. The Company detailed a number of key differentiators setting the Company apart from its competitors. 41. The Company has established several critical barriers to entry that make it difficult for competitors to replicate its product. The Company provided details of each of these barriers. 42. The Company conducted a comprehensive analysis of key competitors to uncover gaps in current offerings and the challenges others face in delivering solutions at the Company's level of sophistication and scale. 43. The Company provided a comparative analysis of the Company and its product and key competitors and their products. Intellectual property 44. The Company is the entity developing the Intellectual Property (IP) and owns the rights to all IP associated with the innovation/product. 45. The Company has formulated a robust IP Protection Strategy that covers its innovations. Information provided: 46. The Company provided documents containing detailed information in relation to its product including: • Private ruling application dated DD MM YYYY and accompanying submission • Pitch Deck and Financial Statements • Responses to our requests for further information. 47. We considered the information within these documents in applying the relevant tests to the Company's circumstances.

Relevant legislative provisions: Income Tax Assessment Act 1997 Subdivision 360-A | Income Tax Assessment Act 1997 section 360-15 | Income Tax Assessment Act 1997 section 360-40 | Income Tax Assessment Act 1997 section 360-45