Document ID: chunk:federal_register_of_legislation:C2023A00029:clause:1_2:p9
Version: federal_register_of_legislation:C2023A00029
Segment Type: clause
Provision Reference: sch 1 cl 2 (pt 9/17)
Character Range: 25313–28163

and another party to the transaction did not deal with each other at *arm's length.

Remuneration of influential employees
 (5) If a natural person (an influential employee):
 (a) is an *associate of the company because of subparagraph 318(2)(d)(i) or (ii) of the Income Tax Assessment Act 1936; and
 (b) performs work or services directly for the company that are attributable to the development of the *digital game in an income year;
then, despite subsection (1), only the first $65,000 of remuneration provided by the company to the influential employee for the income year is development expenditure on the digital game.
Note: A minor voting interest is not sufficient for a person to be an associate of the company.

Decline in value not development expenditure
 (6) To avoid doubt, the decline in the value of a *depreciating asset is not development expenditure on a *digital game.

378‑40  Qualifying Australian development expenditure
 (1) A company's qualifying Australian development expenditure on a *digital game is the company's *development expenditure on the game to the extent to which the expenditure:
 (a) satisfies subsection (2); and
 (b) is incurred for, or is reasonably attributable to, goods and services provided or acquired in Australia.

The relevance test
 (2) An item of a company's *development expenditure on a *digital game:
 (a) if the item of expenditure is substantially attributable to developing the game—satisfies this subsection in full; and
 (b) if the item of expenditure is not substantially attributable to developing the game—satisfies this subsection to the extent that the expenditure is attributable to developing the game.

Expenditure that does not qualify
 (3) For the purposes of a *digital game in respect of which a company applies for a certificate under subsection 378‑25(1) (completion certificate), an item of the company's *development expenditure on the game is not qualifying Australian development expenditure to the extent it is incurred after the earliest of the following:
 (a) the day on which the game is *completed;
 (b) the day on which the company applies for the certificate;
 (c) the day on which the game has been available to the general public for the purposes of conducting testing for one year.
 (4) For the purposes of a *digital game in respect of which a company applies for a certificate under subsection 378‑25(3) (porting certificate), an item of the company's *development expenditure on the game is not qualifying Australian development expenditure to the extent it is incurred after the earlier of the following:
 (a) the day on which the game is *ported;
 (b) the day on which the company applies for the certificate.
 (5) You cannot count the same expenditure as *qualifying Australian development expenditure for the purposes of more than one certificate under