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SR 2001 No. 82 Regulations as made
These Regulations amend the ACIS Administration Regulations 2000.
Administered by: Innovation, Industry, Science and Research
General Comments: This instrument was backcaptured in accordance with Section 36 of the Legislative Instruments Act 2003
Registered 01 Jan 2005
Tabling HistoryDate
Tabled HR22-May-2001
Tabled Senate22-May-2001
Gazetted 04 May 2001
Date of repeal 09 Aug 2013
Repealed by Industry, Innovation, Climate Change, Science, Research and Tertiary Education (Spent and Redundant Instruments) Repeal Regulation 2013

ACIS Administration Amendment Regulations 2001 (No. 1)1

Statutory Rules 2001 No. 822

I, WILLIAM PATRICK DEANE, Governor-General of the Commonwealth of Australia, acting with the advice of the Federal Executive Council, make the following Regulations under the ACIS Administration Act 1999.

Dated 3 May 2001

WILLIAM DEANE

Governor-General

By His Excellency’s Command

NICK MINCHIN


1              Name of Regulations

                These Regulations are the ACIS Administration Amendment Regulations 2001 (No. 1).

2              Commencement

                These Regulations commence on gazettal.

3              Amendment of ACIS Administration Regulations 2000

                Schedule 1 amends the ACIS Administration Regulations 2000.


Schedule 1        Amendments

(regulation 3)

  

[1]         Regulation 3, definition of acquire

substitute

acquire includes acquire by purchase and acquire under a finance lease or operating lease.

[2]         Regulation 3, after definition of Australian‑based research and development

insert

deemed investment means an investment determined under section 6C of the Act to be an investment undertaken by a participant.

[3]         Regulation 3, after definition of electronic communication

insert

finance lease has the meaning given by Accounting Standard AASB 1008, issued by the Australian Accounting Standards Board, as in force on 1 September 2000.

[4]         Regulation 3, definition of raw material

substitute

operating lease has the meaning given by Accounting Standard AASB 1008, issued by the Australian Accounting Standards Board, as in force on 1 September 2000.

original investment, in relation to a deemed investment, means the investment undertaken by the original investor which is determined under section 6C of the Act to be an investment undertaken by a participant.

original investor has the same meaning it has in section 6C of the Act.

previous investment, in relation to an investment undertaken by a participant by way of acquiring plant and equipment under a sale and leaseback arrangement, means whichever of the following that applies:

                (a)    the investment in the plant and equipment undertaken by the participant by way of acquiring the plant and equipment by purchase before it was sold and leased back;

               (b)    the investment in the plant and equipment undertaken by the participant by way of building or making the plant and equipment before it was sold and leased back.

rent, in relation to plant and equipment acquired under an operating lease, means an amount, however described, payable under the lease as consideration for leasing the plant and equipment, but does not include any deposit payable under the lease.

sale and leaseback arrangement, in relation to an investment in plant and equipment undertaken by a participant, means an arrangement under which plant and equipment acquired by purchase, or built or made, by the participant is sold to, and immediately leased back under a finance lease from, another person.

[5]         Regulations 4 and 5

omit

[6]         Regulation 7

omit

[7]         Subregulation 9 (2)

omit

automotive machine tooling or automotive machine tools,

insert

automotive machine tools or automotive tooling,

[8]         After regulation 9

insert

9A           Automotive tooling (Act s 6)

         (1)   For the definition of automotive tooling in subsection 6 (1) of the Act, tooling of the kind mentioned in subregulation (2) is automotive tooling for the purposes of the Act.

         (2)   For subregulation (1), the kind of tooling is interchangeable tooling used, with automotive machine tools, solely for:

                (a)    the production of motor vehicles, engines, engine components or automotive components; or

               (b)    facilitating the provision of automotive services; or

                (c)    the production of other interchangeable tooling for a purpose mentioned in paragraph (a) or (b).

         (3)   Without limiting subregulation (2), tooling of the kind mentioned in that subregulation includes tooling for handling physical inputs that are integral to a relevant production process.

Note   Interchangeable tooling is defined in regulation 3.

[9]         After regulation 13

insert

13A         Circumstances in which components, tools or tooling are taken to be for the MVP’s own use

         (1)   For paragraph 6 (4) (a) of the Act, automotive components, automotive machine tools or automotive tooling produced by an MVP are to be taken to be produced for the MVP’s own use in the circumstances mentioned in paragraph (2) (a) or (b).

         (2)   For subregulation (1), the circumstances are as follows:

                (a)    the automotive components produced by the MVP, whether or not sold to someone else, are used in motor vehicles, engines or engine components produced by the MVP;

               (b)    the automotive machine tools or automotive tooling produced by the MVP, whether or not sold to someone else, are used to produce automotive components, whether or not owned by the MVP, that are used in motor vehicles, engines or engine components produced by the MVP.

         (3)   In this regulation:

automotive components means automotive components other than engines or engine components.

13B         Circumstances in which services are taken to be for the MVP’s own use

         (1)   For paragraph 6 (4) (b) of the Act, automotive services provided by an MVP are to be taken to be provided for the MVP’s own use in the circumstances mentioned in paragraph (2) (a), (b) or (c).

         (2)   For subregulation (1), the circumstances are as follows:

                (a)    the automotive services provided by the MVP, whether or not sold to someone else, are used in the MVP’s production of motor vehicles, engines or engine components;

               (b)    the automotive services provided by the MVP, whether or not sold to someone else, are used in the production of MVP’s components;

                (c)    the automotive services provided by the MVP, whether or not sold to someone else, are used in the production of automotive machine tools or automotive tooling, whether or not owned by the MVP, that are used to produce MVP’s components.

         (3)   In this regulation:

automotive components means automotive components other than engines or engine components.

MVP’s components means automotive components, whether or not owned by the MVP, that are used in motor vehicles, engines or engine components produced by the MVP.

13C         When investment is taken to have occurred

         (1)   For paragraph 6 (5) (a) of the Act, an investment in plant and equipment undertaken by a participant is taken to have occurred for the purposes of the Act:

                (a)    if the investment is by way of acquiring the plant and equipment by purchase or under a finance lease (other than under a sale and leaseback arrangement):

                          (i)    at the time when the plant and equipment is recognised, in the participant’s accounts, as an asset in accordance with normal accounting practices; or

                         (ii)    if at the time referred to in subparagraph (i) the plant and equipment is not in Australia — at the time when the plant and equipment is imported into Australia; or

               (b)    if the investment is by way of acquiring the plant and equipment under an operating lease:

                          (i)    every time rent is paid under the lease; or

                         (ii)    if at a time referred to in subparagraph (i) the plant and equipment is not in Australia — at the time when the plant and equipment is imported into Australia and every time rent is paid under the lease after the plant and equipment has been so imported; or

                (c)    if the investment is by way of building or making the plant and equipment:

                          (i)    at the time when the plant and equipment is recognised, in the participant’s accounts, as an asset in accordance with normal accounting practices, or at the time when the plant or equipment is recorded in the participant’s register of assets, whichever is the earlier; or

                         (ii)    if the plant and equipment (the new plant and equipment) is part of an existing plant and equipment — at the time when the building or making of the new plant and equipment is recognised, in the participant’s accounts, as an increase in asset value in accordance with normal accounting practices, or at the time when the building or making of the new plant or equipment is recorded in the participant’s register of assets, whichever is the earlier.

         (2)   For paragraph 6 (5) (a) of the Act, an investment in plant and equipment undertaken by a participant by way of acquiring the plant and equipment under a sale and leaseback arrangement is taken to have occurred at the time when the previous investment would, apart from section 6B of the Act, have been taken to have occurred under these Regulations and the Act.

         (3)   An investment in research and development undertaken by a participant is taken to have occurred for the purposes of the Act:

                (a)    if the investment is by way of research and development conducted by the participant — every time an expenditure incurred in relation to the research and development is recognised, in the participant’s accounts, as an expense in accordance with normal accounting practices; or

               (b)    if the investment is by way of research and development conducted by another person (other than a Co‑operative Research Centre) on behalf of the participant under a contract with the participant — every time a claim, enforceable by the other person against the participant, arises for any work done in relation to the research and development; or

                (c)    if the investment is by way of research and development conducted by a Co‑operative Research Centre under a contract with the participant — every time the participant makes a contribution to the Centre in relation to the research and development.

13D         When deemed investment is taken to have occurred

                For paragraph 6 (5) (b) of the Act, investment determined, under section 6C of the Act, to be investment undertaken by a participant is taken to have occurred:

                (a)    if the original investor has covered the original investment in a previous return:

                          (i)    at the time when the original investment is taken to have occurred under these Regulations and the Act; or

                         (ii)    if the original investment is in plant and equipment, the plant and equipment has been sold to the participant, and the sale formed part of the circumstances because of which the Secretary made the relevant determination — at the time when the original investment would, apart from section 6B of the Act, have been taken to have occurred under these Regulations and the Act; or

               (b)    if the original investor was a participant at the time the original investment was undertaken, and has not covered the original investment in a previous return:

                          (i)    at the time when the original investment is taken to have occurred under these Regulations and the Act; or

                         (ii)    if the original investment is in plant and equipment, the plant and equipment has been sold to the participant, and the sale formed part of the circumstances because of which the Secretary made the relevant determination — at the time when the original investment would, apart from section 6B of the Act, have been taken to have occurred under these Regulations and the Act; or

                (c)    if the original investor was not a participant at the time the original investment was undertaken but has since been a participant, and has not covered the original investment in a previous return — at the time when the original investment is taken to have occurred under these Regulations; or

               (d)    if the original investor neither was a participant at the time the original investment was undertaken nor has since been a participant — at the time when the original investment would have been taken to have occurred under these Regulations, if the original investor were a participant.

Note   Deemed investment, original investment and original investor are defined in regulation 3.

13E         Allowable plant and equipment

         (1)   For paragraph 6A (3) (a) of the Act, the kinds of plant and equipment mentioned in subregulation (2) are allowable plant and equipment under the Act.

         (2)   For subregulation (1), the kinds of plant and equipment are the following:

                (a)    plant and equipment for the manufacture, assembly, design, development or engineering of motor vehicles, engines, engine components, automotive components, automotive machine tools or automotive tooling;

               (b)    plant and equipment directly supporting the manufacture, assembly, design, development or engineering of motor vehicles, engines, engine components, automotive components, automotive machine tools or automotive tooling;

                (c)    plant and equipment required to comply with a law of the Commonwealth, a State or a Territory directly relating to the manufacture, assembly, design, development or engineering of motor vehicles, engines, engine components, automotive components, automotive machine tools or automotive tooling;

               (d)    plant and equipment for the activation of manufacturing processes for the production of motor vehicles, engines, engine components, automotive components, automotive machine tools or automotive tooling;

                (e)    plant and equipment facilitating the provision of automotive services or approved research and development;

                (f)    plant and equipment indirectly supporting functions that are integral to the production of motor vehicles, engines, engine components, automotive components, automotive machine tools or automotive tooling.

Examples for paragraph (b)

Plant and equipment for build sequencing and process control, supply of materials to an assembly line, movement of components or sub-assemblies from process to process, quality assurance testing and monitoring, or painting or other final preparation of the product as a saleable product.

Examples for paragraph (c)

Plant and equipment required to comply with vehicle emission standards or environmental controls on production.

Examples for paragraph (d)

Plant and equipment for motor vehicle ordering and inventory control systems.

Examples for paragraph (f)

Plant and equipment for purchasing systems for goods or services, or for costing systems.

Note   Allowable plant and equipment, for a participant, may include plant and equipment installed on a site that is not owned or controlled by the participant.

         (3)   Without limiting subregulation (2), plant and equipment of a kind mentioned in a paragraph in that subregulation includes the following:

                (a)    computer hardware and software to the extent that the hardware or software is used for a function or process mentioned in that paragraph;

               (b)    a facility:

                          (i)    having a special functional role relating to a function or process mentioned in that paragraph; and

                         (ii)    not used solely for housing or sheltering a production process or the provision of automotive services;

                (c)    any spare or replacement part for the plant and equipment.

Examples for paragraph (b)

Reinforced flooring for heavy items of plant, or a paint room or other controlled environment.

         (4)   However, plant and equipment of a kind mentioned in a paragraph in subregulation (2) does not include the following:

                (a)    plant and equipment not in Australia or not for use in Australia;

               (b)    land;

                (c)    a building that is not a facility referred to in paragraph (3) (b);

               (d)    plant and equipment that has a value of less than $300 when new;

                (e)    plant and equipment that has previously been owned or used in Australia;

                (f)    for a participant, plant and equipment acquired by the participant under a finance lease for an initial term of less than 12 months.

         (5)   For paragraph (4) (e), plant and equipment is not taken, for a participant, to have previously been owned or used in Australia if:

                (a)    the investment in the plant and equipment is undertaken by the participant by way of acquiring the plant and equipment under a sale and leaseback arrangement, and:

                          (i)    the plant and equipment has been owned in Australia only by the participant before the sale and leaseback arrangement; or

                         (ii)    if the previous investment is a deemed investment — the plant and equipment has been owned in Australia only by the original investor and the participant before the sale and leaseback arrangement; or

               (b)    the investment in the plant and equipment is undertaken by the participant by way of acquiring the plant and equipment under a finance lease and:

                          (i)    the lessor has not been, and is not, a participant; and

                         (ii)    the plant and equipment has been owned in Australia only by the lessor; and

                        (iii)    the plant and equipment has not been used in Australia before the acquisition; or

                (c)    the investment in the plant and equipment is undertaken by the participant by way of acquiring the plant and equipment under an operating lease and:

                          (i)    the lessor has not been, and is not, a participant; and

                         (ii)    the plant and equipment has been owned in Australia only by the lessor; and

                        (iii)    the plant and equipment has not been used in Australia, or has been used in Australia only by the participant under another operating lease immediately before the acquisition.

13F         Maximum claimable value for allowable plant and equipment

         (1)   For subparagraph 6A (3) (b) (i) of the Act, the method of calculating the maximum claimable value for allowable plant and equipment of each kind mentioned in subregulation 13E (2) is set out in this regulation.

         (2)   If the plant and equipment is acquired by the participant by purchase, the maximum claimable value is:

where:

A is the purchase price for the plant and equipment.

B is the sum of the following:

                (a)    any amount included in the purchase price to cover installation costs for the plant and equipment that is separately itemised;

               (b)    any amount included in the purchase price to cover maintenance costs for the plant and equipment.

C is the sum of each of the following that relates to the purchase and that has not been included in the purchase price:

                (a)    freight charges;

               (b)    insurance costs;

                (c)    import charges;

               (d)    clearance charges;

                (e)    sales taxes.

         (3)   If the plant and equipment is acquired by the participant under a finance lease (other than under a sale and leaseback arrangement), the maximum claimable value is:

where:

D is the capital value of the plant and equipment shown on the lease document.

         (4)   If the plant and equipment is acquired by the participant under a sale and leaseback arrangement, the maximum claimable value is:

                (a)    the amount claimed for the previous investment; or

               (b)    if the previous investment has not been covered in a previous return — the maximum claimable value, worked out under subregulation (2) or (6), for the plant and equipment in relation to the previous investment.

         (5)   If the plant and equipment is acquired by the participant under an operating lease, the maximum claimable value, for a quarter, is:

                (a)    the total amount paid as rent under the lease in that quarter for any period within the period:

                          (i)    starting:

                                   (A)     at the beginning of the period of 2 years before the registration quarter for the participant; or

                                   (B)     if at the time referred to in sub‑subparagraph (A) the plant and equipment is not in Australia — on the day when the plant and equipment is imported into Australia; and

                         (ii)    ending at the end of 31 December 2005; or

               (b)    if the plant and equipment is imported into Australia in that quarter — the total amount paid as rent under the lease before the end of that quarter for any period within the period:

                          (i)    beginning on the day when the plant and equipment is imported into Australia; and

                         (ii)    ending at the end of 31 December 2005.

         (6)   If the plant and equipment is built or made by the participant, the maximum claimable value, for a quarter, is:

where:

E is:

                (a)    the value of the plant or equipment recorded in the participant’s accounts or register of assets; or

               (b)    if the plant and equipment (the new plant and equipment) is part of an existing plant and equipment — the total net increase, recorded in the participant’s accounts or register of assets for that quarter, in the value of the existing plant or equipment as a result of the building and making of the new plant and equipment.

         (7)   Despite anything in subregulations (2), (3), (5) and (6), if an expenditure, however described, is to be taken into account in working out the maximum claimable value and the expenditure includes an amount of GST payable on the supply to which the expenditure relates, the expenditure is to be reduced by the amount of GST for the purpose of working out the maximum claimable value.

Note   If an investment involves the participant entering into a transaction with another person, subsection 9 (2) of the Act states that the value of the investment is to be determined on the basis that the participant and the other person are at arm’s length.  See ACIS Administration (Arm’s Length Transactions) Guidelines 2000 on how to determine arm’s length amounts.

13G         Allowable research and development

         (1)   For paragraph 6A (4) (a) of the Act, the kind of research and development mentioned in subregulation (2) is allowable research and development under the Act.

         (2)   For subregulation (1), the kind of research and development is research and development activities that are:

                (a)    directly related to the design, development, engineering or production of motor vehicles, engines, engine components, automotive components, automotive machine tools or automotive tooling; and

               (b)    undertaken for the purpose of:

                          (i)    acquiring new knowledge; or

                         (ii)    creating new or improved materials, products, devices, production processes or services.

         (3)   Without limiting subregulation (2), research and development of the kind mentioned in that subregulation includes the following activities:

                (a)    basic and strategic research;

               (b)    industrial and engineering design;

                (c)    production engineering;

               (d)    development activities relating to the building and testing of prototypes;

                (e)    re-engineering and modification of existing products and processes;

                (f)    development and installation of purpose-designed systems for:

                          (i)    quality assurance and process control; or

                         (ii)    materials or movement control;

               (g)    testing and modification of new production systems (either purpose-built or interchangeable) to achieve repeatability within specified tolerances;

               (h)    obtaining industrial property rights, including:

                          (i)    the preparation and lodging of applications and other documents that are required to be lodged, in Australia or elsewhere, for the initial grant or registration of the rights; and

                         (ii)    the initial grant or registration of the rights, in Australia or elsewhere;

                (i)    for a participant, activities conducted at the participant’s own expense that are aimed at improving a product or process of an engine or component supplier to the participant.

         (4)   However, research and development of the kind mentioned in subregulation (2) does not include the following activities:

                (a)    design of buildings (whether or not the buildings are to be used to house a research and development activity);

               (b)    design and installation of financial management systems;

                (c)    market research, market testing, market development or sales promotion (including customer surveys);

               (d)    routine quality control;

                (e)    management studies or efficiency surveys;

                (f)    routine collection of information (other than for the purpose of research and development);

               (g)    the acquisition from another participant of technology or the rights to use technology;

               (h)    the protection of industrial property rights by legal action.

         (5)   Also, for a participant, research and development of the kind mentioned in subregulation (2):

                (a)    includes research and development conducted by another person (other than a Co‑operative Research Centre) on behalf of the participant under a contract with the participant only if:

                          (i)    the research and development is Australian‑based research and development; and

                         (ii)    the participant contributes to the direction and management of the research and development; and

                        (iii)    the participant has a proportionate share in any intellectual property resulting from the research and development; and

                        (iv)    the participant is not required to conduct the research and development on behalf of:

                                   (A)     another person under a contract with the other person; or

                                   (B)     if the participant is an MVP — another participant under a contract with the other participant; and

               (b)    includes research and development conducted by a Co‑operative Research Centre under a contract with the participant only if:

                          (i)    the research and development is Australian‑based research and development; and

                         (ii)    the participant contributes to the direction and management of the research and development; and

                        (iii)    the participant has the right to use any intellectual property resulting from the research and development; and

                        (iv)    the participant is not required to conduct the research and development on behalf of:

                                   (A)     another person under a contract with the other person; or

                                   (B)     if the participant is an MVP — another participant under a contract with the other participant; and

                (c)    includes offshore research and development conducted by the participant only if:

                          (i)    the requirements mentioned in subregulation (6) are met; and

                         (ii)    the participant is not required to conduct the research and development on behalf of:

                                   (A)     another person under a contract with the other person; or

                                   (B)     if the participant is an MVP — another participant under a contract with the other participant; and

               (d)    includes Australian‑based research and development conducted by the participant only if the participant is not required to conduct the research and development on behalf of:

                          (i)    another person under a contract with the other person; or

                         (ii)    if the participant is an MVP — another participant under a contract with the other participant.

         (6)   For subparagraph (5) (c) (i), the requirements are:

                (a)    the offshore research and development is necessary to tailor the participant’s Australian-based research and development to a particular market; or

               (b)    all of the following:

                          (i)    the offshore research and development is necessary to lever the participant’s Australian-based research and development off an offshore research and development program;

                         (ii)    the offshore research and development contributes directly to the offshore research and development program;

                        (iii)    the participant contributes to the direction and management of the offshore research and development program, and has a proportionate share in any intellectual property resulting from the program.

         (7)   In this regulation:

engine or component supplier means a supplier of:

                (a)    engines, engine components, automotive components, automotive machine tools or automotive tooling; or

               (b)    parts or materials for anything mentioned in paragraph (a).

13H         Maximum claimable value for allowable research and development

         (1)   For subparagraph 6A (4) (b) (i) of the Act, the method of calculating the maximum claimable value for allowable research and development of the kind mentioned in subregulation 13G (2) is set out in this regulation and regulation 13I.

         (2)   If the research and development is Australian‑based research and development conducted by the participant, the maximum claimable value, for a quarter, is:

where:

F is the sum of each of the following amounts of expenditure that has been recognised, in that quarter in the participant’s accounts, as an expense in accordance with normal accounting practices:

                (a)    labour costs, within the meaning of subregulation 13I (1), in respect of employees carrying out, or directly supporting, the research and development;

               (b)    the cost, within the meaning of subregulation 13I (2), of recruiting, training and developing employees referred to in paragraph (a);

                (c)    if the research and development covers an activity that has been carried out by a person under a contract for services with the participant, the amount payable, under the contract, to the person for the activity;

               (d)    the cost of purchasing, for the purposes of the research and development, any plant and equipment that is consumed or tested to destruction within 12 months after its purchase;

                (e)    the cost of purchasing, for the purposes of the research and development, any work order materials.

Examples for paragraph (a) of employees carrying out research and development

Engineers, researchers and technical staff.

Examples for paragraph (a) of employees directly supporting research and development

Skilled or unskilled craftspersons, secretarial and clerical staff, and executive staff involved in the management of scientific or technical aspects of the research and development.

Examples for paragraph (e)

Materials used in manufacturing prototypes of automotive components.

Note   The acquisition of approved plant and equipment for research and development that is recognised, in the participant’s accounts, as an asset in accordance with normal accounting practices is dealt with in regulation 13E.

         (3)   If the research and development is Australian‑based research and development conducted by another person (other than a Co-operative Research Centre) on behalf of the participant under a contract with the participant, the maximum claimable value, for a quarter, is the total amount of claims, enforceable by the other person against the participant, that arise, in that quarter, for any work done in relation to the research and development.

         (4)   If the research and development is Australian‑based research and development conducted by a Co‑operative Research Centre under a contract with the participant, the maximum claimable value, for a quarter, is the total amount of contribution made, in that quarter, by the participant to the Centre in relation to the research and development.

         (5)   If the research and development is offshore research and development conducted by the participant, the maximum claimable value, for a quarter, is the lesser of sum A and sum B worked out under subregulations (6) and (7).

         (6)   For subregulation (5), sum A is the sum of each of the following amounts of expenditure that has been recognised, in that quarter in the participant’s accounts, as an expense in accordance with normal accounting practices:

                (a)    labour costs, within the meaning of subregulation 13I (1), in respect of employees carrying out, or directly supporting, the research and development;

               (b)    the cost, within the meaning of subregulation 13I (2), of recruiting, training and developing of employees referred to in paragraph (a);

                (c)    if the research and development covers an activity that has been carried out by a person under a contract for services with the participant, the amount payable, under the contract, to the person for the activity;

               (d)    the cost of acquiring, for the purposes of the research and development, any plant and equipment that is consumed or tested to destruction within 12 months after its acquisition;

                (e)    the cost of purchasing, for the purposes of the research and development, any work order materials.

Examples for paragraph (a) of employees carrying out research and development

Engineers, researchers and technical staff.

Examples for paragraph (a) of employees directly supporting research and development

Skilled or unskilled craftspersons, secretarial and clerical staff, and executive staff involved in the management of scientific or technical aspects of the research and development.

Examples for paragraph (e)

Materials used in manufacturing prototypes of automotive components.

Note   The acquisition of approved plant and equipment for research and development that is recognised, in the participant’s accounts, as an asset in accordance with normal accounting practices is dealt with in regulation 13E.

         (7)   For subregulation (5), sum B is:

where:

G is the sum of the maximum claimable values for Australian‑based research and development conducted by, or on behalf of the participant, worked out under subregulations (2), (3) and (4) for that quarter.

13I           Meaning of labour costs and costs of recruitment, training and development, etc

         (1)   For the purpose of working out the maximum claimable value of allowable research and development, labour costs in respect of an employee includes each of the following that applies to the employee:

                (a)    salary or wages;

               (b)    allowances, bonuses, overtime and penalty rate payments;

                (c)    leave payments for annual leave, sick leave and long service leave;

               (d)    superannuation fund contributions, payroll tax and workers’ compensation insurance premiums;

                (e)    the cost of providing any vehicle or other benefits included in the employee’s remuneration package;

but does not include any fringe benefits tax payable in respect of the benefits referred to in paragraph (e).

         (2)   Without limiting paragraphs 13H (2) (b) and (6) (b), the cost of recruiting, training and developing an employee includes the following:

                (a)    costs of graduate development programs;

               (b)    costs of training to use software specifically related to the research and development;

                (c)    labour costs in respect of employees managing, directly supporting or assisting, or directly involved in, the recruitment, training and development, of the employee.

         (3)   Despite anything in regulation 13H:

                (a)    if an amount referred to in that regulation relates to activities other than those covered by the allowable research and development, only the part of the amount that relates to the research and development is to be taken into account; and

               (b)    if an expenditure, however described, is to be taken into account in working out the maximum claimable value and the expenditure includes an amount of GST payable on the supply to which the expenditure relates, the expenditure is to be reduced by the amount of GST for the purpose of working out the maximum claimable value.

Example for paragraph (a)

If an employee transfers from the area of the company responsible for sales to the area responsible for research and development, leave payments for any leave accrued while the employee was with the sales area cannot be included in the labour costs in respect of the employee for the purposes of working out the maximum claimable value under regulation 13H.

Note   If an investment involves the participant entering into a transaction with another person, subsection 9 (2) of the Act states that the value of the investment is to be determined on the basis that the participant and the other person are at arm’s length.  See ACIS Administration (Arm’s Length Transactions) Guidelines 2000 on how to determine arm’s length amounts.

         (4)   In this regulation:

fringe benefits tax has the meaning given by subsection 136 (1) of the Fringe Benefits Tax Assessment Act 1986.

[10]      Further amendments

The following provisions are amended by omitting ‘machine tooling’ and inserting ‘tooling’:

·         regulation 3, definition of interchangeable tooling, paragraph (i)

·         subregulation 11 (2)

·         subregulation 14 (2).

Notes

1.       These Regulations amend Statutory Rules 2000 No. 243.

2.       Notified in the Commonwealth of Australia Gazette on 4 May 2001.