Private ruling: Early-stage innovation company eligibility
Date of advice: 25 March 2026
Published: 1 June 2026
Ruling period: DD MM YYYY to DD MM YYYY
Date scheme commenced: DD MM YYYY

Ruling: Q1: Does the Company satisfy the early stage tests under paragraphs 360-40(1)(a)(b)(c) and (d) of the Income Tax Assessment Act 1997 for the period DD MM YYYY to DD MM YYYY? | A1: Yes. | Q2: Does the Company satisfy the principles-based innovation test under subparagraphs 360-40(1)(e)(i)(ii)(iii)(iv) and (v) of the Income Tax Assessment Act 1997 for the period DD MM YYYY to DD MM YYYY? | A2: Yes.

Relevant facts and circumstances: Background Facts 1. The Company is a proprietary company incorporated in Australia on DD MM YYYY. 2. Person X is a director of the Company. 3. The Company's registered office and principal place of business is situated in a state or territory in Australia. 4. The Company has no wholly owned subsidiaries and is not part of an income tax consolidated group. 5. For the financial year ended 30 June 20XX, the Company incurred less than $1 million expenditure and had less than $200,000 assessable income. 6. 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. 7. The Company intends to issue new shares to eligible investors in the financial year ending 30 June 20XX. Product Development 8. The Company is developing a world-first, AI-enabled platform for use in a particular industry. 9. The Company has undertaken substantial development activities relating to the design, architecture and implementation of its proprietary technology platform. The Company provided details of these activities. 10. The Company has developed the core components of its platform however further steps are required to complete development and achieve full commercialisation. The Company provided details of these steps including timeframes. Commercialisation 11. The Company is genuinely focused on developing its novel product for commercialisation. 12. The Company has commenced several activities supporting the commercialisation of its platform. The Company outlined these activities. 13. The Company will commercialise its platform through a staged rollout. The Company detailed its market entry strategy under a number of Phases. High Growth Potential 14. The Company has high growth potential as it targets a global market exceeding $XX in asset value and has a $XX addressable market. 15. The Company undertook research into the size and growth potential of the specific market. The research included industry analysis, market opportunity assessment and competitive analysis. 16. These activities helped inform the development of the Company's product strategy and commercial model. 17. The Company's revenue and expenses projection displays increasing operating leverage, with revenue growth outpacing both cost of goods sold and operating expenses over time. Scale up the business 18. The Company demonstrated that it has the capability to scale up its business. 19. The Company's platform is designed for geographic scalability. 20. The Company's platform operates using a software-based infrastructure, allowing growth without proportional increases in operating costs. 21. The Company provided details of key scalability factors including: • platform architecture • automation and AI • global deployment capability. Broader than Local Market 22. The Company targets national and international markets and therefore targets markets beyond a local or regional scope. 23. The Company provided its timeline and strategy to first achieve national coverage across major Australian metropolitan areas. 24. The Company detailed its global expansion plan, including a timeline, naming initial target countries and target customers. Competitive Advantages 25. The Company demonstrated that it has the potential to maintain a durable competitive advantage. 26. The Company provided details of factors that collectively support its defensible and sustainable competitive position including: • proprietary technology • first-mover positioning • cost advantage • AI integration across its platform. 27. The Company has undertaken analysis of existing platforms and identified limitations in current market offerings. 28. The Company provided a comparison of the characteristics of existing solutions and the characteristics of the platform it is developing. 29. The Company's competitor analysis highlights a gap in the market for advanced technology. 30. The Company has not identified any direct competitors offering the same functionality as its platform. Intellectual Property 31. The Company has full ownership the intellectual property (IP) it is developing. 32. The Company has implemented several measures to protect its IP and technology including patent protection. Information provided 1. The Company provided various documents containing detailed information in relation to its product including: • Private ruling application dated DD MM YYYY. • Responses to our Request for Information received on DD MM YYYY. • Pitch deck, Revenue and Expenses Projection. 2. We have referred to the information within these documents in applying the relevant tests to the Company's circumstances.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 360-40 | Income Tax Assessment Act 1997 subsection 360-40(1) | Income Tax Assessment Act 1997 paragraph 360-40(1)(e)