Document ID: chunk:federal_register_of_legislation:C2025C00029:section:2:p2
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 2 (pt 2/7)
Character Range: 5168620–5171489

Income Tax Assessment Act 1936, an *R&D entity can deduct an amount under section 355‑205 or 355‑480 for an income year (the present year) or an earlier income year; and
 (b) that Subdivision applies to the calculation of that amount; and
 (c) the entity can deduct an amount, as a result of that application of that Subdivision, for the present year;
the entity is taken to be able to deduct under section 355‑205 or 355‑480 (as appropriate) the amount referred to in paragraph (c) for the present year.
Note: Section 355‑205 is about deductions for R&D expenditure. Section 355‑480 is about deductions for earlier year associate R&D expenditure.

355‑115  Working out an R&D entity's total expenses
 (1) For the purposes of subsection 355‑100(1A), an *R&D entity's total expenses for an income year is the sum of the amounts covered by subsection (2).
 (2) The following amounts are covered by this subsection:
 (a) the *R&D entity's total expenses for the income year worked out in accordance with:
 (i) the *accounting principles; or
 (ii) if accounting principles do not apply in relation to the R&D entity—commercially accepted principles relating to accounting;
 (b) any amount the R&D entity can deduct for the income year as mentioned in subsection 355‑100(1), to the extent the amount is not covered by paragraph (a) for the income year.

Amounts counted once only
 (3) For the purposes of subsection (2):
 (a) disregard an amount to which paragraph (2)(a) otherwise applies if paragraph (2)(b) has previously applied in relation to the amount; and
 (b) disregard an amount to which paragraph (2)(b) otherwise applies if paragraph (2)(a) has previously applied in relation to the amount.

Subdivision 355‑D—Notional deductions for R&D expenditure

Table of sections
355‑200 What this Subdivision is about
355‑205 When notional deductions for R&D expenditure arise
355‑210 Conditions for R&D activities
355‑215 R&D activities conducted by a permanent establishment for other parts of the body corporate
355‑220 R&D activities conducted for a foreign entity
355‑225 Expenditure that cannot be notionally deducted

355‑200  What this Subdivision is about

      An R&D entity can notionally deduct its expenditure on registered R&D activities for which certain conditions are met.
      There are special conditions for R&D activities conducted for foreign residents.

355‑205  When notional deductions for R&D expenditure arise
 (1) An *R&D entity can deduct for an income year (the present year) expenditure it incurs during that year to the extent that the expenditure:
 (a) is incurred on one or more *R&D activities:
 (i) for which the R&D entity is registered under section 27A of the Industry Research and Development Act 1986 for an income year; and
 (ii) that are activities to which section 355‑210 (conditions for R&D activities) applies; and
 (b) if