Private ruling: Early-stage innovation company eligibility
Date of advice: 23 October 2025
Published: 8 December 2025
Ruling period: DD MM YYYY to DD MM YYYY | 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 and 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 by the Australian Securities & Investment Commission (ASIC) and registered in the Australian Business Register (ABR) on DD MM YYYY. 2. The Directors of the Company are Person X, Person Y and Person Z. 3. The Company's principal place of business is situated in a state or territory in Australia. 4. The Company is not part of an income tax consolidated group. 5. The Company has one wholly owned subsidiary. The subsidiary is not trading and is dormant. 6. For the financial year ended 30 June 20XX, the Company had less than $1 million in expenditure and had less than $200,000 assessable income. 7. For the financial year ending 30 June 20XX, the Company had less than $1 million in expenditure and had less than $200,000 assessable income. 8. 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. 9. The Company intends to issue equity interests to eligible investors in the income year ending 30 June 20XX. 10. The Company is developing its own Intellectual Property (IP) and owns the rights to all IP associated with its innovation/product. Product Development and Commercialisation 11. The Company's focus is on developing a platform that transforms operational management by providing a centralised, data-driven, and automated solution for organisations. 12. Currently, XXX represent one of the largest untracked expenses for businesses, with a number of inefficiencies as listed by the Company. 13. The Company detailed how its platform addresses these inefficiencies. 14. The Company detailed the functionalities embedded in its innovative platform. 15. The Company detailed how the platform is designed to function at scale and enable organisational benchmarking and targeted interventions, resulting in productivity improvement. 16. The Company has achieved early traction in the market as evidenced by the number of users on the platform and revenue generated from foundational clients. 17. The Company has obtained internationally recognised security standards. 18. The Company is backed by a skilled team. Their combined expertise and experience ensures the platform is positioned for sustained innovation and growth. 19. The Company already has customers in Australia and overseas and plans to expand significantly in these markets and in new markets. 20. The Company has successfully completed Phase One of development. 21. The platform has undergone initial beta testing with positive outcomes. 22. The Company detailed its current development activities and estimated when their product will reach full development and commercial readiness. High Growth Potential 23. The Company exhibits significant high-growth potential by addressing a critical, largely unmanaged cost in organisations. 24. The global demand for the technology is high and projected to grow significantly. 25. The Company's platform targets this untapped market opportunity, leveraging innovative functionalities to deliver measurable improvements that are not natively provided by incumbent solutions. 26. With a strong foundation in the domestic market, a vast global Total Addressable Market (TAM), and clear strategies for international expansion, the Company is well-positioned to scale rapidly and achieve long-term growth. 27. The Company already has a high number of connected users and has paying customers. This early traction highlights the Company's ability to address domestic market inefficiencies while creating scalable, repeatable solutions. 28. The Company is uniquely positioned to scale internationally, targeting organisational pain points shared by businesses worldwide. 29. The Company has the expertise needed to deliver tailored solutions in the international market. 30. The Company's international growth strategy focuses on expanding its integration capabilities with global platforms. 31. Partnerships that will facilitate access to established networks in new regions, and the Company's achievement of international security standards increase the Company's growth potential. 32. Significant increase in Total Revenue over X financial years demonstrates the Company's ability to generate larger revenue from their product. 33. The platform's roadmap includes enhancing the platform's functionalities to broaden its value to users and developing new products, positioning the Company as a long-term leader in the market. Scale up the business 34. The Company demonstrates strong potential for scaling its business by addressing a universal and increasingly pressing challenge in the modern workplace. 35. The platform's seamless integration with existing digital tools allows the platform to embed itself into workflows, making it an essential part of modern workplace operations. 36. As more organisations digitise their processes, the demand for such solutions will continue to grow, offering substantial scaling potential. 37. The Company employs a scalable business-to-business (B2B) SaaS model using a pricing structure that grows as their clients grow. 38. This model ensures a predictable revenue stream and allows organisations to see clear return on investment (ROI) as they expand their usage of the platform. 39. The Company's early success with the high number of connected users across multiple organisations demonstrates its ability to scale customer acquisition. 40. Reseller partnerships and direct distribution strategies enhance the Company's reach, enabling it to access established networks and introduce the platform to new markets efficiently. 41. As organisations increasingly seek tools to improve efficiency, reduce waste, and optimise workflows, the Company is positioned to become a key player in the enterprise productivity ecosystem. 42. The Company's ability to address universal pain points ensures a broad market appeal, while its scalability ensures it can serve both domestic and international markets effectively. 43. The Company's TAM across Australia and overseas countries highlights the significant opportunity for scaling internationally. 44. The Company has prepared for global expansion, obtaining international security standards. 45. The Company's strategy to integrate with globally dominant platforms ensures relevance and utility in international markets. 46. The Company's leadership team brings a wealth of experience in scaling businesses, including successful exists and listings of tech ventures. 47. The team's proven ability to remain lean and adaptive while efficiently iterating on their product positions the Company to respond quickly to market demands and operational challenges as it grows. 48. Their extensive networks also provide access to top-tier talent and strategic partnerships, further supporting scalability. Broader than Local Market 49. The platform uniquely positions the Company to serve broader markets, including global markets. 50. Through scalable technology, a universal approach to solving the identified inefficiencies, and a comprehensive international expansion strategy, the Company demonstrates clear potential to impact organisations worldwide. 51. The Company's focus on optimising operational efficiency aligns perfectly with trends in the modern workplace. 52. The platform's features directly cater to the growing reliance on digital tools in global work environments. 53. The Company's platform is built to scale across diverse organisational needs and geographies. Its seamless integration with global platforms ensures global compatibility and positions the platform as an indispensable tool for enterprises worldwide. 54. The adaptability of the platform's architecture allows it to meet the demands of workforces in various industries, making it highly relevant in international markets. 55. The Company's extensive TAM highlights its global growth potential, with opportunities valued at A$XX. 56. Having obtained international security standard certifications positions the Company as a trusted partner for enterprises in highly regulated regions. 57. The Company's leadership team have prior experience expanding Australian software businesses internationally. This experience has already yielded results with the Company signing overseas customers. Competitive Advantages 58. The Company has developed a defensible competitive advantage through its proprietary technologies, integration into enterprise workflows, and its unique ability to drive behaviour change at scale - something lacking in existing solutions. 59. The Company provided details of its competitor analysis, naming key competitors and partial competitors and detailing the characteristics and functionalities of the platform which allow the Company to outperform those competitors. 60. The level of value provided to customers relative to competitors is being highlighted by customers. 61. The success of the platform's deliverables is the result of deep, hard-to-replicate engineering. 62. The Company's platform is architected for global scalability, with advantages that support expansion into international markets from day one. 63. The platform's deep integrations with globally dominant tools ensure it can be rapidly adopted in diverse workplace environments. 64. Being security standard certified enables the Company to meet stringent procurement and data handling standards of large overseas enterprises. These certifications have been instrumental in building trust with corporate customers and satisfying due diligence processes that are typically barriers for early-stage vendors. 65. The Company's leadership team has prior experience expanding software businesses internationally. Their networks and insights provide a significant edge in executing the Company's international growth plans. 66. The platform's functionality and demonstrated impact positions the Company as a global leader in enterprise productivity innovation. Information provided: 1. The Company provided documents containing detailed information in relation to its product including: • Private ruling application dated DD MM YYYY and accompanying submission. • Responses to our Request for further information received on DD MM YYYY. 2. 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