Document ID: chunk:federal_register_of_legislation:C2021C00270:clause:5_29:p2
Version: federal_register_of_legislation:C2021C00270
Segment Type: clause
Provision Reference: sch 5 cl 29 (pt 2/10)
Character Range: 65958–68727

have been incurred, or to be incurred, on certain activities.
Note: Paragraph (c) includes expenditure incurred in purchasing a tangible depreciating asset to be used when conducting R&D activities.
 (2) The amount is equal to the sum of:
 (a) so much of the expenditure referred to in subsection (1) that is deducted under this Division; and
 (b) for each asset (if any) for which expenditure referred to in subsection (1) is included in the asset's *cost—each amount (if any) equal to the asset's decline in value that is deducted under this Division;
that is taken into account in working out *tax offsets under section 355‑100 obtained by the *R&D entity for one or more income years.
Note: Paragraphs (a) and (b) of this subsection refer to amounts notionally deducted under this Division (see section 355‑105).

Amount is reduced by any repayments of the recoupment
 (3) For the purposes of subsection (2), reduce the expenditure referred to in subparagraph (1)(c)(i) by any repayments of the *recoupment during an income year.

Cap on extra income tax if recoupment relates to a project
 (4) Despite subsection (2), if the *recoupment is covered by subparagraph (1)(c)(ii), the amount mentioned in subsection (2) for the present year cannot exceed the amount worked out using the following formula:
where:
net amount of the recoupment means the total amount of the *recoupment, less any repayments of the recoupment during an income year.
R&D expenditure means the amount mentioned in subsection (2), disregarding subsection (3).

Related entities
 (5) The other entities for the purposes of paragraph (1)(a) are as follows:
 (a) an entity *connected with the *R&D entity;
 (b) an *affiliate of the R&D entity or an entity of which the R&D entity is an affiliate.

355‑445  Feedstock adjustments
 (1) The *R&D entity has an amount under this section if:
 (a) it incurs expenditure in one or more income years in acquiring or producing goods, or materials, (the feedstock inputs) transformed or processed during *R&D activities in producing one or more tangible products (the feedstock outputs); and
 (b) it obtains under section 355‑100 *tax offsets for one or more income years (each an offset year) for deductions under this Division:
 (i) for the expenditure; or
 (ii) for expenditure it incurs on any energy input directly into the transformation or processing; or
 (iii) for the decline in value of assets used in acquiring or producing the feedstock inputs; and
 (c) during the present year, a feedstock output, or a transformed feedstock output, (the marketable product), is:
 (i) *supplied by the R&D entity to another entity; or
 (ii) applied by the R&D entity to the R&D entity's own use, other than use for the purpose of transforming that product for