Private ruling: Early-stage innovation company eligibility
Date of advice: 15 September 2025
Published: 17 November 2025
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: Early Stage Test 1. The Company is an Australian proprietary company incorporated on DD MM YYYY. 2. Total expenses incurred by the Company for the financial year ended 30 June 20XX was less than $1 million. 3. The Company's total assessable income for the financial year ended 30 June 20XX was less than $200,000. 4. The Company's equity interests are not listed for quotation in the official list of any stock exchange, either in Australia or a foreign country. Background Facts 5. The Company does not have any wholly or partly owned subsidiaries. 6. The Company is not part of an income tax consolidated group. 7. Person X is the director of the Company. 8. The Company's registered office and principal place of business are situated in a state or territory in Australia. 9. The Company is not a foreign company within the meaning of the Corporations Act 2001 (Cth) . 10. The Company owns rights to all IP related to the Company's technology and processes.

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


Prior private ruling: 11. On DD MM YYYY, the Company applied for a private ruling regarding the Company's ESIC eligibility. | 12. On DD MM YYYY, the Commissioner of Taxation issued a private ruling for the period DD MM YYYY to DD MM YYYY that the Company met the criteria of an ESIC. | 13. The basis for the decision was that the Company satisfied the principles-based test in respect of the product being developed by the Company. | 14. This application is a request for the continuation of the prior ruling to cover the period DD MM YYYY to DD MM YYYY. | Product development and commercialisation updates: 15. The Company has built its prototype and advanced into initial beta testing with initial channel partners. | 16. The Company provided a detailed list of product features and customer benefits that are still under development. | 17. The Company intends to launch its product into market in the financial year ending 30 June 20XX and leverage that success by signing major distribution deals with key market participants. | 18. There has been no major divergence in the strategy and go-to-market plans since the prior private ruling application. | 19. The Company is in the process of completing a subsequent capital raise to fund the launch and initial growth. | 20. The Company will issue new ordinary shares to investors during the period DD MM YYYY to DD MM YYYY. | Information provided: 1. The Company provided documents containing information regarding the Company and the product it is developing including: | • Private ruling application dated DD MM YYYY and supplemental updates. | • Notice of private ruling issued DD MM YYYY. | 2. We referred to the relevant information within these documents, and the Company's prior Private ruling application, dated DD MM YYYY, in applying the relevant tests to the Company's circumstances.