Document ID: chunk:federal_register_of_legislation:C2005C00282:clause:2_73bn
Version: federal_register_of_legislation:C2005C00282
Segment Type: clause
Provision Reference: sch 2 cl 73BN
Character Range: 33491–35575

73BN  Effective life calculation under Division 42 of Income Tax Assessment Act 1997 to take into account use for purpose of carrying on research and development activities

 (1) This section has effect for the purposes of working out, under sections 42‑105, 42‑110 and 42‑112 of the Income Tax Assessment Act 1997 (whether in their application for the purposes of section 73BH of this Act or otherwise), the effective life of a unit of plant of an eligible company:
 (a) that was acquired, or constructed, under a contract entered into by the company after 12 pm, by legal time in the Australian Capital Territory, on 29 January 2001; or
 (b) that the company commenced to construct after 12 pm, by legal time in the Australian Capital Territory, on 29 January 2001.

 (2) If, at the time at which the effective life is worked out, it is reasonably likely that the plant will be used at some time by any eligible company for the purpose of the carrying on by or on behalf of the eligible company of research and development activities:
 (a) references in sections 42‑105, 42‑110 and 42‑112 of the Income Tax Assessment Act 1997 to the period the unit can be used by any entity for income producing purposes include references to the period the unit can be used by any eligible company for the purpose of the carrying on by or on behalf of the eligible company of research and development activities; and
 (b) for the purposes of subsection 42‑105(3) and paragraph 42‑112(5)(c) of that Act, it is to be concluded that no eligible company that can use the unit for the purpose of the carrying on by or on behalf of the eligible company of research and development activities will scrap the unit, will sell it for scrap value or less or will abandon it, for reasons attributable to technical risk in carrying on those activities.

 (3) In this section:

eligible company has the same meaning as in section 73B.

plant has the same meaning as in Division 42 of the Income Tax Assessment Act 1997.

research and development activities has the same meaning as in section 73B of this Act.