Private ruling: Early-stage innovation company eligibility
Date of advice: 18 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 were 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 has no wholly or partly owned subsidiaries. 6. The Company's director is Person A. 7. The Company is not a foreign company within the meaning of the Corporations Act 2001 (Cth) . 8. The Company owns the intellectual property rights associated with its innovation (the product).

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: 9. On DD MM YYYY, the Company applied for a private ruling regarding the Company's ESIC eligibility. | 10. 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. | 11. The basis for the decision was that the Company satisfied the principles-based test in respect of the product being developed by the Company. | 12. 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: 13. The Company's product provides operational solutions for a particular industry. | 14. The product will help businesses in the addressable market increase production efficiencies and operational safety. | 15. The Company has continued to develop and commercialise its product: | • The Company has further developed the visual elements of the product and the product's functionalities and capabilities. | • Commercial negotiations for pilot trials are ongoing with a number of early adopter initial customers. | • The Company has followed up with potential investors and has investors lined up. | • The Company has completed Industry Growth Programs and been accepted into an accelerator program. | • The Company has achieved success in forming distribution arrangements with leading consulting firms. | • The Company has presented its product at trade shows. | 16. Progress on the product and product positioning has been promising. It is anticipated that the initial customers' results will help propel business growth. | 17. The Company will issue new ordinary shares to investors in the income year ending 30 June 20XX. | Information provided: 18. The Company provided documents containing information regarding the Company and the product it is developing including: | • Private ruling application DD MM YYYY and supplemental updates. | • Notice of private ruling issued DD MM YYYY. | 19. 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.