Private ruling: ESIC - eligibility
Date of advice: 19 September 2025
Published: 10 November 2025
Ruling period: Year ending 30/6/20XX
Date scheme commenced: 1/7/20XX

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 from XX/XX/20XX to XX/XX/20XX? | A1: Yes

Relevant facts and circumstances: Early stage test 1. The Company is a proprietary company incorporated on XX/XX/20XX. 2. The Company has no wholly or partly owned subsidiaries and is not part of an income tax consolidated group. 3. For the 20XX income year, the Company's: (a) total income was $X, and (b) total expenditure was $X. 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. 5. The 'test time' for determining if the Company is a qualifying ESIC, will be upon the issue of qualifying shares on a particular date or dates on or after XX/XX/20XX, and on or before XX/XX/20XX. Product development 6. The Company is developing and commercialising the technology. 7. The Company's technology offers the potential to overcome many of the challenges of existing technologies used. 8. The Company has demonstrated that it has taken tangible steps to identify a gap in the market, to create an innovative product to fill the gap in the market and to commercialise the innovation to generate revenue. 9. The Company is 'genuinely focussed on developing new or significantly improved innovations for commercialisation'. High growth potential 10. The Company has previous presented a 'Business Model' demonstrating high growth potential. Scale up the business 11. The Company has the potential to successfully scale up as the bulk of the development cost is incurred up front. The innovation has been engineered from day one according to best practice to provide for hyper-scaling. Broader than local market 12. The Company's CEO and shareholders have a global outlook, though is starting local to perfect the innovation, thereafter they plan to expand rapidly overseas leveraging existing personal and business relationships. Competitive advantages 13. In the rapidly evolving landscape of technology, the Company asserts their innovation will offer a comprehensive suite of tools designed to enhance every aspect of their future clients' workflow. Conclusion 14. The Company meets the eligibility criteria of an ESIC under subsection 360-40(1) for the 20XX income year.

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